German Chancellor Friedrich Merz said the public would not accept climate policies that lead to deindustrialization, warning that they would hinder progress and innovation.German Chancellor Friedrich Merz has said that climate protection policies should not hinder economic and industrial progress. "We want to contribute to a reduction in climate change and Germany will make huge efforts to combat it," he told the international Petersberg Climate Dialogue (PCD) conference in Berlin on Wednesday. However, he insisted on "multilateral, ambitious and effective" climate policies to retain public support and encourage economic growth. "A transformation which leads to deindustrialization will not be accepted by the public and will ultimately hinder innovation," he said. "Nevertheless, we will continue to be an important sponsor of public climate action." Since 2010, Germany has hosted the Petersberg Climate Dialogue in addition to the UN climate conferences. Originally held in Petersberg, near Bonn, the meeting now regularly takes place in Berlin. Clean energy as driver of growth The German chancellor also highlighted the potential for economic growth offered by investments in clean energy, with the global market for green technology set to nearly triple by 2035 to around $2 billion (€1.7 billion). "Clean energy has become a driver of growth," said Merz. "In Germany, the clean-tech sector has grown 50% faster than the overall economy since 2010." Merz, who leads the conservative Christian Democratic Union (CDU), also expressed his support for emissions trading since it is "market-based and technology-neutral." However, an update to the European Union's emissions trading system (ETS) rules "with a clear focus on maintaining competitiveness" is needed to make the scheme "fit for the future", Merz added. The ETS, established in 2005, was intended to address climate change. The system caps greenhouse gas emissions and creates a market for companies to trade allowances, requiring heavy polluters to purchase permits. Germany has set a goal of achieving climate neutrality by 2045. While Merz has insisted that the country will meet its targets, environmental groups have criticized his government for rolling back green policies. His coalition government has called for the EU's ban on combustion engines to be loosened and has pushed for the construction of gas-fired power plants. Edited by: Karl Sexton