German coalition partner seeks protections for European steel, document shows

By Andreas Rinke BERLIN (Reuters) -Germany's Social Democrats, junior partners in Chancellor Friedrich Merz's coalition, will push for a more protectionist stance on Europe's steel industry, urging the EU to adopt a "buy European" strategy, a document seen by Reuters on Saturday showed. The SPD, headed by Finance Minister Lars Klingbeil, is due to adopt the proposals next week. They call for the European Commission to adopt a "robust trade protection" strategy to defend against subsidised foreign competitors. "At its core, what is needed is a tariff quota system that effectively limits excessive import volumes while keeping the market controlled and open," the SPD said. The proposals are likely to feed into a steel summit called by the conservative chancellor for this month for steel producers, German states and trade unions to thrash out proposals for supporting the industry. The extent to which the SPD's proposals will be adopted though remains unclear. Most German political parties have previously been against protectionism as the country has for the past two decades been one of the world's greatest beneficiaries of low trade barriers. However, German manufacturers and regulators are now increasingly worried about the distorting impact of competition from China and elsewhere and of U.S. tariffs. "We can't allow domestic value creation to depart just because the international rules are no longer working," the SPD said in the document. "This is not about protectionism, but about enforcing fair competition rules and European strategic interests," it said. The SPD also called for tighter controls on the import of Russian steel, including measures to prevent it entering the European market via Turkey. The SPD in particular has suffered electorally from de-industrialization in its formerly industrial heartlands, seeing the far-right eat into its vote share. (Writing by Thomas Escritt; Editing by Susan Fenton)

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