- The China-Germany trade and investment outlook 2026 highlights stronger cooperation in green hydrogen, electric vehicles, and industrial automation.
- The trade and investment outlook 2026 also shows a shift towards sustainable, high-value manufacturing partnerships.
China and Germany are reinforcing their economic partnership despite rising geopolitical uncertainty. In the first eight months of 2025, China overtook the United States to reclaim its position as Germany’s largest trading partner. Bilateral trade reached €163.4 billion (US$189.7 billion), showing the resilience of their economic ties. Both countries remain deeply linked through advanced manufacturing, green innovation, and technology exchange.
As 2026 approaches, both economies are redefining their engagement. China is driving innovation-led growth, while Germany is strengthening supply chain resilience and accelerating its energy transition. These strategies are reshaping how companies operate, invest, and collaborate across industries.
China’s economic agenda focuses on developing “New Quality Productive Forces.” It emphasises advanced manufacturing, artificial intelligence, and renewable energy. The goal is to boost technological independence and attract high-quality foreign investment in industrial modernisation and carbon reduction. Germany, meanwhile, follows its 2023 China Strategy, which promotes “de-risking without decoupling.” It seeks to protect national interests while maintaining competitiveness in global technology supply chains.
Across Europe, new measures, such as the Carbon Border Adjustment Mechanism (CBAM) and reviews of electric vehicle subsidies, are transforming trade flows. These actions reveal the European Union’s growing focus on protecting its industrial competitiveness while staying connected to China’s vast market and innovation ecosystem.
Despite stricter regulations, both sides continue to engage in an active dialogue. The most recent China–Germany Joint Economic and Trade Committee confirmed deeper cooperation in automotive innovation, hydrogen energy, and climate technology. Chancellor Friedrich Merz’s planned visit to China later this year reflects Germany’s commitment to maintaining open communication amid tighter oversight.
Looking forward, both nations are expected to enhance collaboration in green technology, hydrogen production, and electric mobility. German firms are expanding localisation in China to protect market share, while diversifying production to Southeast Asia and India. This dual approach helps balance risk and sustain engagement in China’s fast-growing innovation landscape.
By 2026, the relationship will enter a new phase defined by strategic, technology-led cooperation rather than high trade volumes. Businesses that align with both countries’ sustainability and innovation goals will be best positioned to succeed in the evolving China–Germany economic landscape.