Name: How dependent are Germany and China on each other? | DW News
Uploaded: 2026-02-25T23:01:40.000Z
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Germany's Chancellor Friedrich Matz is holding talks with Chinese President Xi Jinping in Beijing, expected to focus on economic cooperation and security issues.

It's Matt's first visit to China since taking office and he's the latest Western leader seeking to reset ties with Beijing.

Matt says he wants to deepen economic ties with China, which was Germany's biggest trading partner last year.

For more background on this, we're now joined by Dr.

Yu Jie, a senior Research Fellow on China at the Chatham House think tank.

Yu Beijing has just hosted UK Prime Minister Keir Starmer and Canada's Premier Mike Carney, Mark Carney rather.

Now Friedrich Merz is meeting with Xi Jinping.

Beyond the closed door discussions on Ukraine and potential trade agreements, what else can we realistically expect from this visit?

What we expected from this visit, I think there are three things that Germany would like to address to China.

Firstly, regarding the substantive trade imbalances between the two countries.

Secondly, I think the German companies are still looking for the very much so called level playing field from the Chinese authority and also related to the critical mineral export control that Beijing has imposing towards most of the Western companies over there now.

Thirdly, I think Germany also looking trying to find out where exactly China stands regarding Russia's invasion towards Ukraine.

So these are three things but also three very incredibly difficult discussions and conversations that this Chancellor is going to have with President Xi.

Now on the other hand, what is China hoping to gain from Matt's visit?

Well, obviously I think we're now in the cusp of these.

The latest the five years plan introduced by the Chinese Commerce Party next month and also equally many of those Chinese companies looking for market just beyond the Chinese domestic market.

So I think for many Chinese companies they still consider Germany as being one of the main destination to putting their investments in and whether this will enable them to looking for alternative places selling their items or they're looking for the alternative return on investment.

So I think that's mostly come from the wishes from the Chinese company is the alternative market.

I think for the Chinese government what they're really interested in is really to somehow draw this close partners with many U.S.

allies with both in Europe but also Asia looks like as if it's a defender for the existing multilateral trading system.

Now in terms of balance, who is more dependent on whom here?

I think obviously really if you look into the trade figure, it seems that Germany is more dependent on China and Chinese market.

But I think on the other hand as of what I said earlier, given the current domestic economic slowdown within China, many Chinese companies looking for the alternative destinations and they consider Germany as the place to be so as to UK so as to many other European countries at the same time.

So I think yes on the one hand we have that very heavy dependence from Germany towards China but equally I think China also depended on Germany in terms of market access as well.

Talking about dependence, Germany was very, very long highly dependent on Russian gas for its energy supply.

On security it was and still is very dependent on the US Is there a danger that Germany could be sleepwalking into a new dependency on trade with China?

Well, I think Germany, the current government also the previous government has already discussed extensively regarding the so called de risking strategy.

Now it's only a matter of how do you put this is so called de risking strategy in practice.

That is to say the debate cannot only take place at the level among the political elites in sits in Berlin, but

this debate will perhaps will have to also take place among the voters in large part of Germany to what extent that engagements with China perhaps bring both benefit and cost and what are they?

And there's something that I believe the Chancellor needs to communicate clear enough to his own voters there.

Dr. Yuji there with Chatham House in London.

Thank you very much for sharing your expertise with us.

And let's get more now on some of the background behind these relations and this meeting.

DWU political correspondent Bernd Riegert is joining us now from Berlin.

So what do you think is the Chancellor's main goal on this trip?

The Chancellor has to walk a very fine line to keep a balance between the German interests, especially the economic interest.

He has to embrace the leadership, if you will, to find solutions for these business interests because Germany is very much dependent on China.

Now China is the biggest trading partner and on the other hand he has to keep a political distance from the leadership in China.

After all the this is a Communist Party state just run by one party, an autocratic leader.

Human rights are a concern and China is supporting Russia in its war against Ukraine.

He has to find distance at the one side and partnership at the other side.

And Madz himself, the Chancellor strike stressed in a statement in Beijing that this partnership is difficult, has to be fair and he wants to to boost it and to maintain the good ties that are there.

But on the other hand he also wants to urge China to change its policies in some fields and what tools does he have at his disposal in order to do that?

Well, the leverage is limited, I would say, because the German economy and German companies are quite dependent on many things now from China when it comes to raw earth, for example, or other supply chains, computer ships, all these things.

But China has a leading position in the world and this cannot be replaced by German businesses very easily.

German companies are setting up factories in China to produce in China because it's just cheaper there.

On the other hand, the Chancellor will argue that the competition is not fair because China is subsidizing its companies.

It has a very low valued currency that makes it possible to flood Europe and Germany with very cheap goods from China.

But the leverage is more on the Chinese side because Germany and also other EU countries are more or less dependent on on many things that are coming from China.

And the Chancellor has also to orchestrate his policies in in a European formation.

The French President, Emmanuel Macron was already there and also the British Prime Minister Starmer.

They all have their own interests, but they don't have a real economic leverage.

And when it comes to the political side, there is less leverage than you could expect.

The Chinese are not impressed by German or European demands to cut ties with Russia.

And so it's very difficult for the Chancellor to actually achieve something on the ground.