Germany supports the trade agreement between the EU and Indonesia to curb dependence on China

Chancellor Olaf Scholz said Sunday he would push for a trade deal between the European Union and Indonesia as part of his country’s efforts to reduce its reliance on China for key commodities

Apr 16, 2023 1:45pm ET

• 2 minutes read

BERLIN – German Chancellor Olaf Scholz said on Sunday he would push for a trade deal between the European Union and Indonesia as part of his country’s efforts to reduce its reliance on China for key commodities.

At the opening of the annual Hannover Messe, Scholz told Indonesian President Joko Widodo that a trade deal between Southeast Asia’s most populous country and the 27-state bloc would create an economic area of ​​700 million people.

“I’m working on finally getting this agreement over the finish line,” Scholz said of the negotiations between Jakarta and Brussels, which have been ongoing since 2016.

The German leader said he was similarly hopeful about talks between the EU and the Mercosur bloc in South America, Mexico, Australia, Kenya and India.

“A whole new dynamic has emerged here in recent months,” he said, adding that such agreements are necessary to help countries reduce their dependence on certain markets.

Germany is particularly concerned about over-reliance on China, including for key raw materials needed for digitization and the transition to a zero-carbon economy.

“We are currently importing many of them from China,” says Scholz.

“Even though rare earths, copper or nickel are often not mined there but in countries like Indonesia, Chile or Namibia,” he said. “We want to change that.”

Scholz said building processing plants for such commodities in countries where they are found would benefit local economies and should be part of any new trade deal.

Indonesia is the partner country of this year’s Hannover Messe.