German Chancellor Friedrich Merz completed his inaugural visit to China on February 26, 2026, holding talks with President Xi Jinping and Premier Li Qiang and leading a delegation of business leaders to Beijing and the tech hub Hangzhou. The trip combined high-level diplomacy with commercial engagement and focused on four principal themes: economic ties and competition, defence of existing political positions on Taiwan, efforts to press China on the war in Ukraine, and steps to deepen sectoral cooperation.
Economic balance and competition
Merz repeatedly highlighted the growing economic imbalance between Germany and China, calling the dynamic “not healthy.” Germany’s trade deficit with China reached a record €89 billion last year, a source of concern for policymakers and many Mittelstand companies. Merz raised issues including trade restrictions, currency questions, subsidies and rare-earths supplies in talks with Premier Li, saying that if China wants to be seen as a reliable partner it must “deliver” on rules-based behaviour.
European measures such as new EU tariffs on Chinese electric vehicles remain a sticking point; Merz acknowledged competition as a major unresolved issue even as he promoted opportunities for investment and market access. He said he would ask Economy Minister Katherina Reiche to engage further with China and that detailed follow-up discussions would be needed after his visit.
Business deals and tech ties
The trip produced tangible business outcomes. China is set to buy up to 120 additional Airbus aircraft, a deal Merz cited as proof of the value of high-level visits. He toured a Siemens Energy facility in Hangzhou and met German corporate representatives from Volkswagen, BMW and Mercedes. Mercedes described the trip as welcome engagement with one of its “most important markets.”
Hangzhou, a major tech cluster home to firms such as Alibaba, AI company DeepSeek and robot-maker Unitree, was a focal point for the business delegation. The visit underlined both commercial opportunity and competitive pressure: German small and medium-sized enterprises report growing quality and price competition from Chinese firms, with a KfW study showing almost one in five Mittelstand companies seeing rising competition from China.
Media and sport cooperation
Cultural and media ties were reinforced when Bundesliga operator DFL and China Media Group signed a memorandum of understanding to extend their TV partnership in the presence of Merz and Premier Li. CMG holds Bundesliga broadcasting rights in China through the 2027–28 season and agreed to cooperate further on promoting young football talent.
Ukraine and geopolitics
Merz raised the war in Ukraine directly with Xi, urging Beijing to use its influence over Moscow to help end the conflict. Chinese state media reported Xi saying diplomacy was “key,” emphasizing equal participation and addressing legitimate concerns of all parties. Merz noted that signals from China are taken seriously in Moscow and that China’s voice matters globally, though he was cautious about expectations, calling for more exertion of influence.
Taiwan and principles
On Taiwan, Merz reiterated Germany’s longstanding position: Berlin adheres to the “one China” policy but warned that any reunification must be achieved by peaceful means, not military force. He stressed that political systems differ but that cooperation remains possible where mutual interest and dialogue exist.
Diplomatic style and next steps
Merz’s approach marked a shift from the more hawkish posture he has sometimes taken; during the trip he sought a “reset” toward strategic partnership where feasible while publicly pressing China on difficult issues. Unlike some predecessors, he did not take on-the-record questions from journalists during parts of the visit, a departure commentators noted. He dined with Xi and lunched with Li, and announced plans for regular visits and upcoming bilateral government-level consultations. He also indicated that further government engagement and visits by economic ministers would follow to work through the outstanding trade and market-access questions.
Overall takeaways
The visit combined concrete commercial outcomes and renewed political dialogue but left unresolved tensions over trade, competition and geopolitics. Merz secured high-profile business deals and pledged ongoing engagement, yet he also acknowledged that China’s rising capacities and their impact on European markets remain a core challenge requiring detailed, sustained negotiation.