German trade deficit with China grows as Beijing relies less on European industry
BERLIN: Germany’s trade deficit with China widened in the first half of 2026, even as the Asian powerhouse remained its top trade partner, preliminary data from state-run agency Germany Trade & Invest (GTAI) showed on Sunday. German exports to China fell over 12% year-on-year to just under €37 billion between January and June, the data showed, as Chinese firms cut reliance on European imports,…
Berlin saw Germany's trade deficit with China widen in the first half of 2026, despite China remaining the nation's largest trading partner. German exports to China fell 12% year-on-year to near €37 billion from January to June, as Chinese firms decreased reliance on European imports. Now, China ranks just ninth among markets for German goods, down from second in 2021 when the country bought €104 billion in merchandise from Germany.
German manufacturing faces challenges from both US tariffs and Chinese competition, leading to job losses at companies like Volkswagen. China's trade surplus with Germany grew from €40 billion in the same period last year to €55 billion this year, with German imports from China increasing 8.9% to €91.8 billion. Total trade between the countries exceeded €128 billion, €3 billion more than the US.
GTAI East Asia expert Corinne Abele explained that declining exports to China result from a weak domestic economy and China's focus on domestic value chains. German firms are now producing more within China, while Chinese property issues and cash-strapped regional governments hinder investment. Smaller economies like Austria and Switzerland bought more German goods than China in 2026.
China's reduced dependence on Germany suggests growing independence from Western powers and technological advancement. Commerzbank economist Vincent Stamer noted that China surpassed the US as Germany's top trading partner in 2025, following US President Donald Trump's return to office and implementation of protectionist tariffs that hurt German exports to the US.
The US remains Germany's largest foreign market, but exports fell 6% to around €74 billion through June, while German imports from the US rose 7.1% to nearly €51 billion. France and the Netherlands are the next biggest export markets. Overall, German exports grew 3.7% to €817 billion through June as global growth sustained orders. However, the "Made in Germany" brand needs reinvention, according to Stamer.
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