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Geopolitics · Asia

Merz backs de-risking with China as EU trade tensions persist

German Chancellor Friedrich Merz called for Germany and Europe to remain united and competitive in building trade ties with China, while rejecting decoupling in favour of de-risking and diversification. His comments came as the European Union reported a €360 billion trade deficit with China in 2025 and sought to manage trade disputes through dialogue and export limits.

AI-assisted synthesis · Based on 4 outlets' reporting · Article text read from 2 of 4 outlets · 1 article captured only in partHow it's made

View timeline · 10 entries
4 outlets2 regionsLatest reporting 4 min readNo new reporting in 4 days
Coverage: Center OnlyL 0 · C 3 · R 0 · 1 unrated
File photo
Photo: EmDee / Wikimedia Commons (CC BY-SA 4.0)

What happened

Key facts

  • Friedrich Merz said Germany and Europe need unity, strength, resilience, innovation and competitiveness to build balanced relations with China.
  • Merz warned that decoupling from China would be “a big mistake” and supported de-risking and diversification instead.
  • The European Union’s trade deficit with China reached €360 billion in 2025, according to the report.

The brief

German Chancellor Friedrich Merz argued that Germany and Europe should strengthen their competitiveness and act together in managing trade relations with China, while rejecting a full economic break. He endorsed de-risking and diversification, describing decoupling as “a big mistake,” and said Europe should seek balanced ties through greater strength, resilience and innovation.

Merz made the comments during a visit to Singapore. He said Germany and Europe wanted to expand free trade under open competition, reliability and a rules-based order. He also called for dialogue with China on trade, security and the international order.

His approach puts economic engagement alongside efforts to reduce exposure to risks, rather than treating separation from China as the goal. The trade figures underscore the scale of the relationship. The European Union’s deficit with China reached €360 billion in 2025, according to The Straits Times.

EU Trade Commissioner Maros Sefcovic put the bloc’s deficit at nearly €197 billion in the first half of 2026, according to DW. These are figures for different periods, not competing estimates of the same period. Germany’s bilateral trade figures show substantial flows in both directions.

Germany’s Federal Statistical Office reported that China exported goods worth €170.6 billion to Germany, while German exports to China totalled €81.3 billion. Those figures accompany Merz’s emphasis on maintaining trade while improving Europe’s position in the relationship. The policy debate is unfolding alongside concrete trade measures.

Earlier in October, China agreed to cap hybrid electric vehicle exports to the European Union over four years, according to The Straits Times. Germany has also advocated stronger defensive trade tools against practices it views as unfair. The sources do not describe a specific German measure adopted as part of that push.

The accounts emphasize different parts of Merz’s message and the dispute. The Straits Times focuses on unity, resilience and defensive tools, and highlights the €360 billion deficit figure for 2025. DW stresses free trade, competition and rules, and reports the first-half 2026 deficit figure as well as Germany-China trade values.

Both accounts present Merz as supporting engagement and competitiveness rather than decoupling.

Why it matters

  • Merz’s stance signals that Germany, whose manufacturers rely on Chinese markets and supply chains, will seek to reduce exposure to disruptions without severing trade—a course that could shape the EU’s approach to investment screening, export controls and negotiations with Beijing. The EU’s reported €360 billion trade deficit sharpens pressure on European firms and policymakers to address market access and competition, while diversification may raise costs in the short term as companies find alternative suppliers.

What to watch next

  • Whether Germany advances stronger defensive trade tools against practices it considers unfair.
  • How the European Union and China implement the agreed cap on hybrid electric vehicle exports over four years.
  • Whether Germany and Europe pursue the dialogue with China on trade, security and world order that Merz called for.
  • How EU trade with China develops against the reported first-half 2026 deficit of almost €197 billion.

How it's being covered

Coverage analysisShow details
5 source articles · 4 unique outlets
Outlet political mix: Center Only· 3 Center · 1 unrated
Where the outlets are based: Asia 50% · Europe 25% · Other 25%
Outlet political mix
Center Only
Left
Center
Right
0 outlets
3 outlets
0 outlets
The marker shows coverage balance: each unique outlet counts once. 1 unrated outlet is not included.
Geography
Where the outlets covering this story are based.
4 unique outletsDominant coverage: Asia
Coverage imbalance
  • Coverage is currently concentrated among Center-rated outlets (3 of 3 rated sources); comparatively few Left or Right-rated outlets have published on the event.
How we measure coverage

How outlets' accounts compare

1 framing difference · 1 uncorroborated claim · 1 information gap
The reports repeat the same account with different emphasis; its central claims are not independently confirmed in the reporting Updat3 read.Compared across 2 reports whose article text Updat3 read; 2 other outlets were checked by headline only.
Framing / emphasis differences
Sources emphasise different angles, actors or consequences of the same reporting.
  • The Straits Times emphasizes European unity, resilience and Germany’s call for stronger defensive trade tools; DW foregrounds free trade, open competition and a rules-based order.
Updat3: These are differences of emphasis, not disputes about what is reported. They do not show that the reported claims are true.
One-sided or uncorroborated claims
Claims that come from one party or one source family and are not independently corroborated.
  • Merz described decoupling as “a big mistake,” as reported by The Straits Times.
Updat3: Not independently corroborated yet — treat as a claim, not an established fact.
Not established by the reporting
Information the available reporting does not contain or confirm. This is a gap, not a disagreement.
  • Neither source gives details of the specific trade practices Germany considers unfair or identifies a particular defensive measure Germany has adopted.
Updat3: Updat3 cannot conclude anything about this from the current sources.

Timeline

Developments from this story's sources, dated background we compiled and fact-checked, and our earlier coverage. Each row says which.
  1. The longer institutional relationship began when the European Economic Community and the People’s Republic of China established diplomatic relations in 1975.
    Background · from our historical context
  2. China joined the WTO on 11 December 2001, after which its access to global markets expanded under the organisation’s trade rules.
    Background · from our historical context
  3. The EU and China established a Comprehensive Strategic Partnership in 2003, while continuing to negotiate over market access, subsidies and regulation.
    Background · from our historical context
  4. The European Union and China launched negotiations on a Comprehensive Agreement on Investment.
    Background · compiled and fact-checked by Updat3
  5. In 2016, the European Commission and the German government raised concerns about Chinese investment and access to Chinese markets.
    Background · from our historical context
  6. The European Commission presented its trade policy review, setting out its approach to relations with China.
    Background · compiled and fact-checked by Updat3
  7. In September 2023, Germany’s first China Strategy described China as a partner, competitor and systemic rival, and called for reducing dependencies without pursuing broad economic separation.
    Background · from our historical context
  8. The European Commission imposed definitive duties on Chinese-made battery electric vehicles.
    Background · compiled and fact-checked by Updat3
  9. The European Union recorded a €360 billion goods-trade deficit with China.
    Background · compiled and fact-checked by Updat3
  10. In October 2026, China agreed to cap exports of hybrid electric vehicles to the European Union for four years, against a backdrop of disputes over trade and market access.
    Background · from our historical context

How we got here

In October 2026, China agreed to cap exports of hybrid electric vehicles to the European Union for four years, against a backdrop of disputes over trade and market access.

In 2024, the European Commission imposed definitive duties on Chinese-made battery electric vehicles after an anti-subsidy investigation; China subsequently opened trade investigations affecting European products including brandy and pork.

Related developments1 story

Original sources

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