German Finance Minister Warns of Trade War with the US over IRA Issues

[Asia Economy Reporter Kwangho Lee] Christian Lindner, Germany's Finance Minister, warned that a trade war should not break out due to the United States' Inflation Reduction Act (IRA).

On the 4th (local time) at Belt am Sonntag in Germany, Minister Lindner said, "The United States is our valued partner, but at the same time, it is pursuing an extremely protectionist economic policy," adding, "This is primarily aimed at China."

He added, "Accordingly, the German government must represent Germany's national interests in Washington and point out the negative effects."

He also warned that many German companies are already producing in the United States, saying, "Germany should focus on economic diplomacy rather than engaging in a trade war." He further pointed out that Germany should use the IRA to improve its own competitiveness.

Minister Lindner emphasized, "The much higher demands of the European Union (EU) regarding energy prices are as dangerous as the distortion of competition caused by the United States."

The U.S. IRA, a $370 billion (488 trillion won) industrial support program to combat climate change, requires companies to use American-made products or produce in the United States to receive subsidies or tax benefits, raising concerns that other countries, including Europe and Korea, may be disadvantaged.