Clemens Fuest, the Director of the Munich-based Ifo Institute, is calling for a reassessment of how Europe approaches China, particularly in light of rapidly growing imports from the country. Speaking to Focus, Fuest stated that if restrictions are placed on foreign investors in China, the West should respond in kind, with the underlying goal of prompting greater openness from China.
While he agrees that reliance on certain critical goods, such as medical production, should be reduced, the economist strongly rejected the EU Commission’s planned requirement to increase the industrial share of the EU’s economic output to 20 percent. He dismissed this target, relating to the “Industrial Accelerator Act” (IAA), as “planned economy nonsense.”
Furthermore, the Ifo President cautioned against granting an undue preference to European suppliers in public tenders. He argued that the EU Commission’s “Buy European” rule would unnecessarily raise costs and should therefore only be limited to sectors where the involvement of foreign providers poses security risks.
