Merz said Germany needs strong trade ties with China but warned against any “illusions” about Beijing’s global ambitions….reports Asian Lite News
Friedrich Merz will travel to China next week for his first official visit since taking office in May, as Germany seeks to recalibrate its approach to Beijing in an era of intensifying great-power rivalry, according to the Associated Press.
Government spokesperson Sebastian Hille said Friday that Merz will be received in Beijing on Wednesday by Chinese Premier Li Qiang and President Xi Jinping. The chancellor is also scheduled to visit Hangzhou in southeastern China.
Hille described “competition” as a central theme of the trip, adding that Berlin aims to strike the right balance between cooperation and strategic caution. “We want cooperation where it is necessary and in our mutual interest,” he said in Berlin, as reported by AP.
Germany has sought to preserve stable economic ties with China despite concerns over Beijing’s growing assertiveness and its refusal to condemn Russia’s invasion of Ukraine. At the same time, Berlin has worked to reduce overreliance on Chinese trade by diversifying supply chains and expanding commercial links elsewhere.
Data released Friday by Germany’s Federal Statistical Office showed that China regained its position as Germany’s largest single trading partner last year, with total trade reaching €251.8 billion ($297 billion). The United States, which briefly overtook China in 2024, saw trade fall to €240.5 billion.
Speaking at a Christian Democratic Union convention in Stuttgart, Merz said Germany needs business ties worldwide, including with China. He confirmed he would travel with a large business delegation but cautioned that Germany should harbour no “illusions” about Beijing’s ambitions to reshape the multilateral order on its own terms.
Meanwhile, the European Union (EU), beyond tariffs and sanctions, set to continue on its trajectory of diversifying its trading relationships away from China and sharpening its trade defence armoury, developed with China in mind, but Beijing “doesn’t seem much to care”, according to a new report.
According to a report in Politico, the EU-China trade relations are “at a standstill”, as German Chancellor Friedrich Merz is likely making his first visit to China next month.
“The trade deficit is not going to improve anytime; China is not going to consume our products. All of that is wishful thinking,” Alicia Garcia-Herrero, chief economist for Asia-Pacific at French investment bank Natixis and a senior fellow at think tank Bruegel, was quoted as saying.
In December last year, Beijing announced “its latest counterpunch in a dispute over EU duties on Chinese-made electric vehicles imposed in 2024, setting punitive provisional duties on dairy products”.
It was also clearly unhappy with German auto giant Volkswagen’s bid to “wangle an exception to the EV duties”, according to the report.
America’s lurch into protectionism under President Donald Trump is displacing trade flows, making it even harder to resolve thorny issues such as market access and state subsidies. Chinese exports to Europe are on the rise again — and are more than double Europe’s exports to China, which are in decline.
French President Emmanuel Macron wrote in an op-ed for the Financial Times recently that “Either we rebalance economic relations co-operatively — engaging China, the U.S. and the EU in a genuine partnership — or Europe will have no choice but to adopt more protectionist measures”.
However, Chinese President Xi Jinping has yet to heed the calls to rebalance trade.Experts warn that existing tensions may rise even further.
Francesca Ghiretti, director of the China Europe Initiative at the Rand think tank, was quoted as saying in the report that “2026 will intensify the dynamics and tensions already visible in 2025”.
