German Chancellor Merz: The Renminbi Has Been Undervalued by 25% for Years
According to Bloomberg, German Chancellor Merz told students at the opening ceremony of the Adenauer School of Governance at Cologne University on Monday that the Chinese yuan has been undervalued by 25% for many years.
"We have initiated intensive discussions on this issue within the European Council," Merz said, adding that Europe has long underestimated China's political and economic role in the world. "We need a politically driven monetary dialogue with China."
The report notes that as EU leaders intensify efforts to address the trade deficit with China, Merz has repeatedly cited the yuan as one of China's key trade advantages. Last month, he called for international dialogue on the exchange rate of the renminbi.
The report highlights that trade with China has become a top priority for the EU, as the bloc relies heavily on China for importing a range of critical goods, including essential raw materials.
EU policymakers are proceeding cautiously—bolstering their trade policy toolkit while seeking to avoid provoking conflict. Leaders have instructed the European Commission to continue pursuing dialogue while simultaneously strengthening trade defense mechanisms.
Merz stated that determining how Europe should shape its approach toward China presents a "very significant" challenge. "We need to reduce our dependence on China."
On June 19, during the EU summit, Merz referenced the 1985 Plaza Accord when discussing this issue. At that time, finance ministers and central bank governors from the United States, Japan, Germany, France, and the United Kingdom gathered at the iconic Plaza Hotel in New York to coordinate policies aimed at weakening the US dollar. He said: "That is exactly what I have in mind today."
Original source: toutiao.com/article/1870649508946944/
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