Mistaking partner for 'threat' would be costly: China Daily editorial

In a concerning departure from the pragmatic economic diplomacy that has long benefited both nations, the German government plans to adopt a tougher trade stance to counter what it regards as "unfair Chinese trade practices".

A critical stance toward China among German manufacturers has prompted the Friedrich Merz government to take a tougher line, German Finance Minister Lars Klingbeil said after visiting a BMW plant in Spartanburg, South Carolina, on Tuesday. A few days earlier, Klingbeil had said Germany could no longer rely solely on traditional free-trade principles while China strengthened its competitive position, baselessly claiming China was "not playing by the rules" with its "overcapacity, state subsidies, joint venture obligations".

This line of reasoning is fundamentally flawed, as it conflates correlation with causation, overlooks the substantial benefits of Sino-German trade, and threatens to undermine the very foundation of a mutually beneficial economic relationship that has been a cornerstone of Germany's foreign trade and investment for decades.

After attending a G20 finance ministers and central bank governors meeting in Asheville, North Carolina — where the US host falsely pressed allies to address concerns over China's trade surplus — Klingbeil's remarks, which echo Washington's line, reveal just how deeply he has been swayed by his US counterpart's rhetoric on China. Striking a tough stance on China while on US soil may be an easy way to curry favor with Washington. Yet he should recognize that making China a scapegoat for the struggles of German industry will do little to solve Germany's own challenges.

Germany's industrial model, which was heavily dependent on Russian energy supplies before, is in a state of profound structural crisis. Energy costs have skyrocketed since the European Union began phasing out Russian energy imports in response to the Ukraine crisis, while critical infrastructure is lagging, and there is a shortage of skilled workers to navigate the digital and green transitions. The German government's response to the blowing up of the Nord Stream pipelines — on which its energy security so critically depended — only underscores that the nation's economy is effectively being sacrificed at the altar of political correctness.

Blaming China is not only counterproductive but also dismissive of the tangible, decades-long success story of German businesses in China. For decades, German enterprises have been major beneficiaries of China's market and supply chains, reaping substantial profits. In 2025, China once again became Germany's largest trading partner, with the bilateral trade volume reaching €251.8 billion ($291.7 billion), up 2.1 percent year-on-year.

This mutually beneficial partnership is not just a relic of the past. In February, Merz led a high-profile trade delegation of executives from about 30 top German companies to China. The delegation's focus on emerging sectors such as artificial intelligence and industrial digitalization underscored that the future of German industry is intertwined with Chinese innovation and partnership.

During his China trip, Merz said the German business community attaches high importance to the Chinese market and hopes to further deepen cooperation with China for mutual benefit and shared growth. It shows Germany's political and business elites see the huge potential of Sino-German economic and trade cooperation and the opportunities presented to Germany by China's 15th Five-Year Plan (2026-30).

If Berlin blindly follows Washington's lead and slaps additional tariffs or creates new trade barriers against China, it will leave Beijing no choice but to respond with countermeasures. This would only further erode German export volumes and harm the very German companies that are already complaining about a difficult business environment at home. To see the consequences of a trade war, Klingbeil needs to look no further than the US.

The wiser path for Berlin is to strive to strengthen the foundation of Sino-German cooperation. It should recognize that Germany's difficulties in industry are structural and of its own making over a long time.

Those German politicians sharing similar views with Klingbeil ought to address the root causes of domestic problems, and approach trade issues with China with due prudence. Mistaking a partner for a "threat" will prove a costly misjudgment.