The air in Beijing still carries the sharp, lingering scent of Lunar New Year firecrackers, but the arrival of German Chancellor Friedrich Merz on February 25, 2026, signals a far more serious season of diplomatic renewal. In his first official visit to China since assuming office, Merz—a conservative leader often characterized by his tough rhetoric—has made a move that suggests economic realism is beginning to outweigh ideological friction in Berlin. As the first foreign head of state to visit China in the Year of the Horse, Merz brings with him the heavy expectations of a German industrial core that finds itself at a geopolitical and economic crossroads.
The timing of this mission is far from incidental. In the two years since his predecessor, Olaf Scholz, last visited in April 2024, the global landscape has undergone a seismic shift. With a protectionist administration back in the White House wielding tariffs against allies and adversaries alike, and a European economy struggling with negative growth and high energy costs, the China-Germany relationship is quietly recalibrating. On the surface, the visit is a high-profile diplomatic exercise; beneath it lies what many observers call the “anxious sigh” of an industrial giant looking for a way out of global chaos.
The Economic Imperative: Beyond “De-risking”
For several years, the political corridors of Berlin and Brussels have echoed with calls for “de-risking”—a strategic attempt to reduce economic dependency on the Chinese market. However, the hard data from 2025 tells a more complex story. Total trade volume between Germany and China reached 253 billion euros last year, a 2.7% year-on-year increase that saw China remain Germany’s largest trading partner, surpassing the United States. While politicians debated distancing, German businesses were busy localizing their operations.
The crisis is perhaps most acute in the automotive sector, the historical backbone of the German economy. Since 2022, German car exports to China have plummeted by two-thirds as local Chinese manufacturers have gained significant ground. The irony of the “de-risking” era is that direct investment from Germany to China has actually hit a four-year high of 7 billion euros. Major players like Volkswagen, BMW, and Mercedes-Benz are no longer just selling to China; they are integrating their entire supply chains into the country, from R&D centers in Hefei to smart driving partnerships.
Merz, a pragmatist by reputation, seems to understand that empty ideological stances will not safeguard German jobs. His decision to bring a “luxurious” delegation of 30 CEOs—representing heavyweights like Siemens, Bayer, Adidas, and Airbus—is a rational acknowledgment of this dependency. There were reportedly so many companies eager to join the trip that spots were limited, illustrating the private sector’s desire to secure its future in a market that remains critical for global competitiveness.
Hangzhou and the Quest for Digital Synergy
The Chancellor’s itinerary offers a glimpse into Germany’s strategic shift. While the high-level political business was conducted in Beijing, the stop in Hangzhou is particularly telling. As the heart of China’s digital economy, where technology accounts for a quarter of the local GDP, Hangzhou represents the “soft intelligence”—artificial intelligence and robotics—where Germany’s traditional “Industry 4.0” has begun to lag.
For a nation that built its reputation on hardware and mechanical engineering, the realization that it now requires Chinese digital empowerment to modernize its “hard manufacturing” is a humbling but necessary revelation. Merz’s visit to tech and energy companies in Zhejiang is an attempt to show German entrepreneurs where the future of global markets lies. This is no longer the old trade logic where Germany drew the blueprints and China provided the labor. In the emerging era, China may provide the algorithms and the scenarios, while Germany provides the craftsmanship and quality control.
This “positioning trip” is also a calculated effort to gain leverage in the precarious China-U.S.-Europe triangle. With Donald Trump expected to visit China in April, Merz’s arrival in February is a move to secure a stronger voice for Germany before Washington sets a new trans-Atlantic agenda. It marks a moment of “strategic awakening” for Europe, which is realizing that “America First” policies mean excessive dependence on the U.S. is no longer a cost-effective or safe strategy.
Navigating the “Two-Faced” Dilemma
Despite the pragmatic tone of the visit, significant hurdles remain. Merz’s government continues to navigate a “two-faced” policy that reflects Germany’s central dilemma: it cannot thrive economically without China, but it is politically unwilling to break from the United States. This inconsistency is evident in Berlin’s recent actions: on one hand, it announced a 30 billion euro subsidy plan for new energy vehicles that includes Chinese manufacturers; on the other, high-ranking officials continue to describe China as a “challenger to the international order”.
These political differences and value clashes mean the relationship is unlikely to return to the frictionless era of the past. However, the objective of this visit is not a return to the past, but the establishment of a “new normal” characterized by pragmatic cooperation. Merz is seeking to move beyond the binary of “cooperation or competition” to a more sophisticated model where both sides find ways to mitigate risks while pursuing mutual growth.
As Europe’s largest economy, Germany’s pivot toward a more clear-eyed pragmatism could serve as a stabilizer for the entire EU-China relationship. Since the start of 2026, leaders from Ireland, Finland, and the UK have already made their way to Beijing, suggesting a broader European trend toward re-engagement. For China, the visit is an opportunity to showcase its industrial upgrades and its role as a cooperative partner in a fragmenting global order. Ultimately, the success of this mission will be tested by whether Berlin can withstand both internal and external pressures to persist with a pragmatic approach
Mr. Qaiser Nawab, a global peace activist, is a distinguished international expert specializing in the Belt and Road Initiative (BRI), Afghanistan, Central Asia and founder of the Belt and Road Initiative for Sustainable Development (BRISD), a newly established global think-tank headquartered in Islamabad, in conjunction with the one-decade celebration of BRI.
