Berlin, May 26, 2025, Under Chancellor Friedrich Merz, Germany has emphasized a policy of “de-risking without decoupling” in its relations with China, aiming to reduce strategic dependencies, particularly in supply chains and sensitive technologies, while maintaining strong economic ties, trade and diplomatic cooperation. Source
Key Highlights
De-risking Strategy Over Full Decoupling
- Germany is pursuing “de-risking” rather than full decoupling from China: implementing measures to reduce overreliance in critical sectors while preserving economic engagement. Source
- German firms are being encouraged to assess geopolitical risk in supply chains more rigorously, especially in tech, semiconductors, rare earths, and pharmaceuticals. Source
High-Level Dialogue & Mutual Assurances
- On July 4, 2025, Chancellor Merz met Chinese Foreign Minister Wang Yi in Berlin. Merz underscored that Germany-China relations are progressing well, with cooperation growing in politics, economy, and trade. Germany expressed willingness to uphold openness, mutual benefit, promote fair trade, and address crises and global challenges in cooperation with China. Source
- Wang Yi during the meeting emphasized that China-Germany relations are mature, stable and not targeted at third parties. He appreciated Germany’s constructive attitude and reaffirmed China’s commitment to high-level exchanges and stable bilateral relations. Source
Maintaining Economic Interdependence
- Despite concerns about strategic vulnerabilities, Germany-China trade flows remain substantial. Bilateral trade and investment still form a core part of Germany’s economic strategy with Asia. Source
- Germany aims to diversify supply chains in sensitive sectors, promote resilience, and also encourages local production in Europe and partner countries. Source
What This Means for Bilateral Relations
Germany’s approach reflects a balancing act: safeguarding national and economic security by reducing strategic risks, while preventing economic fallout from an abrupt decoupling. The high-level meeting in Berlin signals that Germany seeks a stable, predictable cooperation with China, even amid global challenges. The policy suggests more oversight, stricter screening in sensitive sectors, and possibly regulatory constraints, but also an openness to trade, investment, and joint engagements.
Final Thoughts
Under Chancellor Friedrich Merz, Germany is recalibrating its China policy. “De-risking without decoupling” may become a defining feature: a policy that seeks to protect strategic interests, maintain economic ties, and manage inherent risks in a complex international environment. The July 4 meeting with Chinese leadership shows both sides are committed to maintaining stable relations even while adjustments are made. Source
