The European Union’s recent decision to impose tariffs on Chinese electric vehicles has increased internal tensions within the German government. Despite Chancellor Olaf Scholz’s vehement opposition, most EU member states voted in favor of the measure, shining a spotlight on Germany’s waning power in the EU.
At a time when Germany’s economic model is increasingly dependent on demand from China, efforts to turn the tide domestically have failed. This is in stark contrast to the times of Angela Merkel, who used clever diplomatic maneuvers to reach suitable compromises, as was once the case with solar modules. However, the current coalition is becoming increasingly disjointed and inward-looking as the country’s economy heads toward a prolonged recession.
Brussels diplomats are frustrated by Germany’s inconsistent foreign policy and see the chance of a united front against China’s economic pressure dwindling. Although Germany is resisting, Brussels continues to strive for a compromise with Beijing. An internal source at the German Foreign Ministry suggests avoiding possible punitive tariffs to prevent unfair market competition practices.
Despite open tensions within the German government, the Federation of German Industries (BDI) also shows support for protective measures in foreign trade, provided this appears feasible. The struggle within Europe continues, especially as other trade policy decisions, such as supply chain regulations or cross-border bank mergers, illustrate Germany’s oppositional stance.
While emerging countries such as Hungary support Germany’s position, Berlin lacks coherent influence to significantly shape EU policy. Criticism also comes from outside: The punitive tariff dispute reveals a loss of leadership in European trade policy, which persists without solidarity with Paris. Commentators see the EU Commission as having the herculean task of establishing a disciplined approach to global trade agreements without Germany’s full backing.
