German cars are the best in the world, its finance minister insists: 'They do not have to fear Chinese competition'

German carmakers do not have to fear competition from China and are still considered the best in the world, German Finance Minister Christian Lindner told CNBC.

"German cars are the best cars in the world, doesn't matter if internal combustion engine or electrified vehicle," he told CNBC's Karen Tso on the sidelines of the IMF Spring Meetings in Washington, D.C., on Thursday.

"German car manufacturers are world leading, they do not have to fear Chinese competition," Lindner said.

Competition in the electric vehicle, or EV, market in China and Europe, as well as the U.S., has been heating up in recent months. More and more Chinese companies are making headway when it comes to EVs, and China's BYD has been in close competition with Tesla for the crown of biggest EV maker.

China's EV sector has seen substantial growth, sending a large amount of vehicles to other markets that often come at a more accessible price point. This rapid development has raised questions and concerns about China's trade practices and policies in the U.S. and the European Union.  

U.S. Treasury Secretary Janet Yellen last month warned that China may be using global markets as a dumping ground for cheaper clean energy products, including EVs. This could push down market prices and put pressure on green manufacturing elsewhere, Yellen said.

Both Yellen and European Commission chief Ursula von der Leyen earlier this month called for a tough stance on potential unfair competitive practices from China. The European Union has also launched an investigation into Chinese subsidies for EVs.

China has denied any wrongdoing, with its Minister of Commerce, Wang Wentao, saying that any allegations about "overcapacity" were without merit. China's success in the EV sector