Germany’s Scholz ‘surprised’ by companies’ China dependence

BERLIN (Reuters) – German Chancellor Olaf Scholz said the number of German companies that have ignored the risks of depending too heavily on the Chinese market was remarkable and stressed the need for diversification, in an interview with Focus magazine on Friday.

“The importance of the Chinese market needs no explanation,” he said, but the goal is not to be dependent on any one market.

“I am therefore surprised at how dependent some companies have made themselves on individual markets and have completely ignored the risks,” Scholz told the magazine.

Such dependencies show Germany needs to be more active in raw materials such as lithium and cobalt. “Even in mining, we can’t afford to be comfortable any more,” added the chancellor.

In early November, Scholz became the first Group of Seven (G7) leader to visit China since the COVID-19 pandemic, where he bluntly complained about access to the Chinese market.

He made the trip while facing criticism from within his own coalition about relations with Beijing. He has tried to balance securing a level playing field for European companies with shedding Germany’s heavy reliance on the Chinese market.

(Reporting by Andreas Rinke; Writing by Miranda Murray; Editing by Rachel More)