Trade Cases

China and Germany to Work on Steel Overcapacity Within G20

Written by Sandy Williams


China and German have agreed to work together to find solutions for steel overcapacity within the framework of the G20 group of nations.

In a phone call on Saturday, German Chancellor Angela Merkel and Chinese President Xi Jingping discussed the importance of multilateral cooperation in global trade and the need for the two countries to become “advocates for new-type international relations.” The agreement was in response to the shift by the current U.S. administration toward protectionism.

“China-Germany relations will steadily proceed for as long as they adhere to equality and mutual respect, understand and care for each other’s core interests and major concerns, and properly control and handle their differences,” Xinhua said, attributing the comments to Xi.

G20 is scheduled to meet beginning on Monday in Buenos Aires, Argentina. U.S. Treasury Secretary Steve Mnuchin is scheduled to discuss steel overcapacity with German Finance Minister Olaf Scholz on the sidelines of the summit meeting.

The Section 232 tariffs to be imposed by the United States are expected to be a central issue at the talks. Argentina’s Treasury Minister Nicholas Dujovne stressed that G20 will continue to support “the crucial role of the rules-based international trading system.”

“We aim to reach an agreement in terms of maintaining the wording of the Hamburg communique (about) sustaining the benefits of free trade,” said Dujovne.

Trump has been critical of both China and Germany for their trade surpluses with the United States. Merkel said on Friday that the proposed U.S. tariffs on steel and aluminum violate the principles of the World Trade Organization.

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