Merz's Beijing Visit Tests Germany's Balance Between Values and Economics

When Friedrich Merz warned last year that economic dependencies make Germany "susceptible to blackmail" by China, he was speaking as opposition leader. Now, as chancellor heading to Beijing this week, he's about to confront the gap between political rhetoric and economic reality.

The Pragmatic Shift

Merz has never been shy about his positions. As chairman of the transatlantic advocacy group Atlantik-Brücke from 2009 to 2019, he championed Western values and alliance relationships. But the chancellorship brings three harsh realities: Germany's export-driven economy is under strain, the transatlantic environment is deteriorating with Trump's return, and moral posturing doesn't pay the bills of an industrial economy.

German automakers like Volkswagen and BMW still depend heavily on Chinese markets, while companies like Siemens generate over €10 billion annually from China operations. Chemical giant BASF has committed $10 billion to a production site in Guangdong province. These aren't easily replaceable relationships.

The Broader European Dilemma

Merz's visit comes amid escalating trade tensions. The EU has imposed tariffs on Chinese electric vehicles, and China has responded with anti-dumping duties on German brandy. Neither side wants a full trade war, but both are protecting their interests more aggressively.

This reflects a broader shift in how democratic nations approach authoritarian trading partners. The era of "change through trade" – the belief that economic integration would gradually democratize authoritarian regimes – is largely over. Now the question is how to manage necessary economic relationships while protecting strategic interests.

Competing Voices at Home

Within Germany, the debate is intensifying. Green Party politicians and human rights advocates argue for prioritizing values over commerce. Business leaders counter that complete decoupling isn't realistic. The Federation of German Industries (BDI) advocates for "risk management" rather than relationship termination.

This internal tension mirrors debates across Western capitals. How do you balance economic pragmatism with values-based foreign policy? How do you reduce dangerous dependencies without destroying beneficial trade relationships?

The Transatlantic Factor

Trump's return adds another layer of complexity. His administration's unpredictable approach to both China and European allies leaves Germany navigating multiple uncertainties simultaneously. Merz can't simply align with Washington's China policy when that policy itself remains unclear.

For Germany, this creates an opportunity to chart a more independent course – but also the risk of finding itself isolated between competing superpowers.