Overview

• German exports fell 1.7% last year to about €1.55 trillion while China’s exports grew 7.1% to over €3 trillion, according to the Statistisches Bundesamt and Beijing figures.
• China’s ‘ziqiang’ or self-strengthening policy and generous state subsidies have bolstered domestic overcapacity and technological gains in areas such as digitalization and generative AI.
• High energy prices in Germany have eroded competitiveness, particularly in energy-intensive sectors like chemicals and the automotive industry.
• China’s private-sector debt has climbed above 300% of GDP, raising alarm among economists about the risk of a potential financial crisis.
• US-China trade tensions have shifted flows: German exports to China fell 16% through April while imports from China rose 10%, prompting calls for EU countermeasures.