Newly appointed German finance minister voices protectionism concerns

19 Mar 18

Germany’s new finance minister has said protectionism is “not the answer” to trade and warned he is “seriously worried” about the trade stand-offs with the US.

Olaf Scholz, acting head of the German Social Democrats, was chosen to lead the finance ministry last week, as chancellor Angela Merkel was sworn in for a fourth term, almost six months after the election.

The SPD party presented Scholz on Friday among their cabinet picks for Merkel’s government.

The finance minister told Germany newspaper Bild, when asked if a potential trade war was an issue: “I am cautious about using the term ‘war’.

“But I am seriously concerned that the foundation of our prosperity – free trade- is being put at risk. Protectionism is not the answer to the difficulties of our time. The situation is serious.”

On Sunday, Scholz said he would continue talks with the US to avoid the planned steel and aluminium tariffs.

Trump signed an order earlier this month imposing the 25% tariff on steel imports and 10% on aluminium.

The Paris-based OECD also warned last week that a rise in protectionism and emerging trade wars could harm the global economic recovery.  

European Union commissioner Cecilia Malmstrom said the bloc would “stand up to bullies” that create trade wars as countries, and the EU, threatened to retaliate if the tariffs went ahead.

Scholz has been mayor of Hamburg for seven years and has been known for his stance on “budget discipline on the one hand and investment into education, research and infrastructure on the other”, the SPD’s parliamentary caucus leader Andrea Nahles told reporters in Berlin.

The Social Democrats have also taken the foreign and labour ministries in the collation, while Merkel’s Christian Democratic Union will get the ministry of economy and defence.

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