Germany warns of economic collapse as cheap Chinese goods flood Europe

German Economy Minister Robert Habeck has expressed concerns over the potential influx of discounted Chinese goods into European markets, a development he believes could have serious economic consequences for the region.

Habeck raised alarm over the rising volume of Chinese imports into Europe, particularly in light of the US administration's recent imposition of tariffs on foreign goods, Caliber.Az reports per Russian media.

This shift could significantly impact the competitive landscape within European markets, as Chinese products become more appealing due to their lower price points.

Habeck cautioned that this flood of cheap goods could place considerable strain on European industries, already struggling with deflationary pressures.

"European markets may collapse as a result of the overwhelming influx of cheap Chinese goods," he stated.

The minister emphasized that the growing availability of low-cost Chinese products would likely attract more consumers, further undermining local production and leading to the collapse of some European industries.

In his comments, Habeck pointed out that this situation could trigger a wave of bankruptcies among producers unable to compete with the influx of cheaper alternatives. "This will provoke the destruction of some industries, and that means the bankruptcy of producers," he warned.

While the European Union has not yet outlined specific countermeasures, there are growing concerns about the potential for increased inflation across the continent. The imposition of tariffs, compounded by already high inventory levels and low utilization rates in several sectors, could exacerbate disinflationary pressures as businesses are forced to manage their excess stock.

By Vafa Guliyeva