German Chancellor Friedrich Merz concluded a pivotal visit to the Chinese mainland this week, marking a strategic push to revitalize Germany's economy through enhanced cooperation with Asia's largest market. The visit comes as Germany grapples with two consecutive years of economic contraction (2023-2024) and minimal 0.2% growth in 2025, underscoring the urgency for new growth engines.
Accompanied by 30 top executives from automotive, biopharmaceutical, and advanced manufacturing sectors, Merz emphasized China's "irreplaceable role" in Germany's recovery strategy. "Our 7,500-kilometer journey reflects the enormous opportunities we see in cross-industry collaboration," he stated during a Beijing business forum attended by 500 delegates.
While bilateral trade reached €245 billion last year, Germany faces an €89.3 billion trade deficit with China – a gap that's tripled since 2020. Analysts note this imbalance stems from China's growing dominance in renewable energy technologies and electric vehicles, sectors where German firms are now seeking partnerships rather than pure export strategies.
The chemistry sector has emerged as an early success story, with BASF and Sinopec announcing a €7.8 billion joint venture to build Asia's largest circular economy park in Nanjing. Such collaborations align with Germany's push to combine industrial expertise with China's manufacturing scale and innovation speed.
