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At a time when transatlantic relations are once again faltering under the pressure of political turbulence in the United States, China is seizing the opportunity to reshape its relations with a key European player.

Germany — the European Union’s largest economy — has become the center of China’s strategic maneuver, with the stakes being influence over the entire continent and the future of global rare earth metals supply chains. Trade between China and Germany this year is approaching €186 billion annually, slightly surpassing the value of Germany’s trade with the United States (around €184.7 billion). This fact, often overlooked in public debate, illustrates the scale of mutual economic interdependence — as well as the potential China sees in Germany as a gateway to Europe.

Thaw after months of tension

Just a few months ago, the dialogue between Germany and China seemed frozen. A dispute over Chinese restrictions on the export of chips and rare earth elements led to the cancellation of a visit by German Foreign Minister Johann Wadephul in the autumn. China, which had earlier announced sanctions on selected rare earth metals, signaled that a reduction in tensions would neither be quick nor simple. Yet the retreat happened rapidly.

Behind the scenes at the G20 summit on Sunday (November 23) Chinese Premier Li Qiang assured Chancellor Friedrich Merz during talks that “China and Germany are important economic and trade partners,” emphasizing the need to rebuild trust and “expand dialogue in strategic industrial sectors.” At the same time, Vice Premier He Lifeng — a key architect of China’s economic policy — met with German Finance Minister Lars Klingbeil. Simultaneously, Wadephul agreed on a new date for his visit to Beijing with Chinese Foreign Minister Wang Yi.

The pace of these actions suggests that both sides saw further escalation as unprofitable — particularly China, which, facing a trade conflict with the U.S., urgently needs stable allies and customers in Europe.

China shifts tactics

In recent months, a subtle but noticeable shift has been visible in China’s policy toward Europe. Rather than focusing on relations with EU institutions — increasingly protectionist and critical on issues such as human rights or investment transparency — China is prioritizing bilateral talks with key Member States. Germany, with its pragmatic tradition of economic policy, is a natural point of engagement for China.

This is especially true now, as the new government in Germany under Merz signals a willingness to adopt a more realistic, business-oriented approach to Asia. Li Qiang explicitly suggested that he hopes Germany will “eliminate interference and pressure” — a subtle reference to growing U.S. pressure on European partners to limit contacts with China.

A new window for China?

The strategic warming of relations with Germany raises a fundamental question: could closer Sino-German ties signal an easing of tensions between China and the EU? On one hand, Germany — as the bloc’s strongest economy — wields enormous influence over EU trade and industrial policy. A potential German “reset” with China could thus pave the way for a broader thaw in Europe’s relations with China.

On the other hand, China may be using Germany as a wedge — attempting to weaken European unity in the face of radicalizing U.S. policy and growing protectionist pressure from the EU. If Germany begins consistently pursuing its own national economic interests, this could lead to a divergence in EU strategy toward China.

The issue of rare earth metals also looms in the background — critical for the production of batteries, semiconductors, and energy infrastructure. China’s decision to ease sanctions and signal openness toward Germany is no coincidence, as this EU Member State has the greatest influence on regulations being drafted by EU institutions regarding the green transition industry.

A new chapter in Europe?

Merz’s visit to China — expected in the coming weeks — could become a turning point. A meeting with Xi Jinping will not only test the new German government but also send a signal to the entire EU about whether Germany intends to continue its current line of European solidarity or pursue pragmatic realpolitik in the style of Angela Merkel’s former governments.

Whatever decisions are made, one thing has become clear: China sees the future of its influence in Europe running through Germany. And if Germany decides that, in the face of global turbulence, it is worth deepening cooperation with China, the balance of power on the continent could change faster than anyone expects.

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