"China has been one of Germany's largest trading partners for years since 2016, so this is about building on a strong foundation rather than starting from scratch," said Prof. Dr. Sarah Eaton, Professor of Transregional China Studies at Humboldt University Berlin and co-founder of the Berlin Contemporary China Network (BCCN). Her assessment captures the strategic calculus behind Chancellor Friedrich Merz's first official visit to China—a trip that underscored Berlin's effort to hedge against transatlantic turbulence while deepening ties with its most important economic partner.
Merz wrapped up his two-day visit on February 26, summing up his impressions of the world's second-largest economy with three words: "dynamics, exciting, and cooperation." Yet upon returning to Germany, his tone shifted notably. In a speech on February 27, Merz bluntly stated that Germany "is no longer productive enough," while explicitly referencing China's development model—a remark that quickly sparked heated discussions online.
This juxtaposition captures the dual reality facing German leadership: the need to maintain cooperative ties with a vital economic partner while confronting domestic structural weaknesses.
Signal from Hangzhou
The most significant stop on Merz's itinerary was Hangzhou, eastern China's technology hub, where he met representatives from 10 companies specializing in AI, humanoid robotics, and electric vehicles. According to state broadcaster CCTV, Merz had lunch and took group photos with Alibaba CEO Eddie Wu Yongming and Unitree Robotics founder Wang Xingxing. Other participants included AI glasses start-up Rokid, brain-machine interface innovator BrainCo, and EV makers Geely and Leapmotor.
This focus on next-generation industries signals that Germany-China cooperation is moving beyond traditional sectors. "Siemens and other German tech firms like Bosch have deep roots in China and have successfully positioned themselves as reliable partners for China's industrial upgrading," Eaton observed.
"Driven by high energy costs and structural challenges in the German market, many German tech firms are expanding their facilities in China. Siemens wants to contribute to many aspects of China's robotics development, from automation to the technology stack."
The Hangzhou visit concluded Merz's first official trip to China, reflecting Germany's attempt to engage more deeply with the engines of China's digital and robotics economy.
Navigating pressure from the US
The visit's timing is significant, occurring as Trump returns to the White House threatening high tariffs on German goods. "As a strong exporter, the German economy is extremely vulnerable to trade shocks such as the Trump tariffs," Eaton explained. "Like Canada, Germany is now looking for ways to diversify its trading relationships and mitigate the risk of a rocky trade relationship with the US."
Merz's delegation included around 30 top managers from German industrial giants—automakers, chemical companies, and machinery manufacturers—all sectors with massive exposure to the Chinese market. This composition signals Berlin's interest in increasing market access for German companies to address the trade deficit with China, which has become politically sensitive amid Germany's economic stagnation.
A rethinking of global alliances
The Chancellor's recent warning that "blindly following the US is self-destructive" reflects broader European shifts. Eaton noted that Merz's opening remarks at the Munich Security Conference were "strikingly blunt," declaring that the rules-based world order "no longer exists."
"Merz began his tenure hopeful that he could successfully manage the transatlantic relationship on behalf of Europe, but especially since Venezuela and Greenland, his position has markedly shifted, along with other European leaders," Eaton said. "European leaders have understood that the US under Trump is not a stable partner but increasingly an unpredictable adversary. European countries are focused on building up 'strategic autonomy' to mitigate the harm of Washington's shift. China may be seen not necessarily as 'more stable,' but as too important to isolate."
Opportunity and adversity facing German industry
The German auto industry, long dependent on Chinese sales, has been disrupted by the explosive growth of domestic electric vehicle manufacturers. Volkswagen is undertaking massive layoffs as it belatedly attempts the shift to hybrids and EVs—a transition Eaton describes as "long and painful."
"Beyond tariffs, there are many factors that have hit German industry hard—high energy prices and an inflexible labour market—and the circumstances vary a lot across industries," Eaton added.
For other German giants, however, China remains promising. "For other German giants like BASF and Siemens, China remains a land of opportunity and investments in the Chinese mainland are booming," Eaton noted.
Looking ahead, cooperation on technology standards represents an often-overlooked but crucial area of partnership. Since 2015, German standardization bodies DIN and DKE have worked alongside China's SAC on developing high-tech standards of common interest. "For German tech giants, this standardization cooperation is key to ensuring unfettered market access in China," Eaton concluded.
Reporter: Guo Zedong
Cover: Lai Meiya
