Unlikely Allies in Eurozone Trade Wars: Germany and China

One would think that Germany would be the first to support  tough tariffs/duty on Chinese solar panels being imported into the Eurozone. Specially given that Bosch Solar Energy AG and the Siemens Solar unit are dire trouble being unable to compete with cheap Chinese solar panels.

So here is another example of no friends only interests

Companies in the US and Europe complained about these cheap imports, and anti-dumping proceedings were initiated. In Europe, it started last summer. And last week, reports surfaced that the European Commission was ready to act. On June 5th, if no solution materialized, the Commission would slap Chinese-made solar panels, cells, and wafers with punitive import duties of on average 47%.

Last week, the Commission fired another shot, launching an investigation into anti-competitive behavior by Chinese telecom equipment makers Huawei and ZTE, China’s high-tech crown jewels. But the 47% punitive duties on solar panels were the harshest measure yet in the trade war, hitting €21 billion worth of Chinese imports.

On Sunday, it was German Economy Minister Philipp Rösler, who warned of a trade war with China and lambasted the European Commission for its decision to start an anti-dumping procedure against Chinese telecom equipment makers. A “grave mistake,” he called it.

That’s the European dilemma. With many countries mired in recession, and some sinking into depression-like conditions, the Commission wants to protect certain industries. While it can’t protect Spanish companies from German competition, it can protect them from Chinese competition. Given how much German solar-panel makers have suffered under Chinese pressure, and how many billions in subsidies and investments have gone up in smoke, the Commission might have counted on German support.

But for Germany Inc., China is one of the two big economic engines that are still pulling. Exports to the Eurozone, particularly to top trade partner France, have stalled, and the industry is looking to China for growth. Chinese money is also flowing into Germany as Chinese companies are on a shopping spree, paying top euros for 98 firms in 2012, including Putzmeister, a world brand for concrete pumps [article on the aftermath]. Germany Inc. sees in China an escape route from the economic mayhem of the Eurozone; it sees a booming market with over twice the population of the EU. For Germany Inc., China is the future – and Europe a drag. One more treacherous rift across Europe.

From:  http://www.zerohedge.com/contributed/2013-05-21/germany-fires-live-ammo-sino-european-trade-war-brussels