Germany seeks tougher EU trade policy to counter Chinese competition

trade deficit EU customs rules German industry Chinese competition automotive sector

Germany is shifting its trade stance toward China as domestic industries face increasing pressure from Chinese competition and state subsidies. Chancellor Friedrich Merz has tasked his cabinet with drafting proposals for a tougher EU trade policy by October to address trade imbalances and protect European manufacturers.

Finance Minister Lars Klingbeil has called for stronger measures to defend German economic interests, noting that the government can no longer act 'naively' regarding unfair trade practices. The German trade deficit with China rose to approximately 89.3 billion euros in 2025. Major industrial sectors, particularly automotive and machinery, are feeling the impact; Volkswagen has faced reports of 50,000 job reductions, and the broader German industry is reportedly losing over 10,000 jobs per month.

In a separate development, new EU customs rules targeting small packages under 150 euros have begun to show results. Import volumes of low-cost goods from China have dropped by 30 to 40 percent, with platforms like Temu seeing sales declines of roughly 50 percent. However, some retailers suggest that logistics shifts, such as bundling goods into larger containers, may mitigate the long-term impact of these fees.

Entities

China · European Union · Friedrich Merz · Germany · Lars Klingbeil · Siemens Energy · Volkswagen

Claims

What the coverage asserts, and how many sources carry each claim.

[● 2 SOURCES] The number of small package imports into the EU has decreased by 30 to 40 percent since new customs rules were introduced. www.etailment.de · www.chip.de
[○ 1 SOURCE] The EU Commission issued a record fine of 550 million euros against AliExpress for consumer protection violations. www.chip.de
[● 2 SOURCES] Finance Minister Lars Klingbeil stated Germany is considering tougher measures against unfair Chinese trade practices. www.epochtimes.com · finanzmarktwelt.de
[● 2 SOURCES] Sales for the platform Temu reportedly dropped by approximately 50 percent following the new EU customs rules. www.etailment.de · www.chip.de
[○ 1 SOURCE] German industry is losing more than 10,000 jobs per month, according to an Ernst & Young report. www.journaldunet.com
[● 2 SOURCES] Germany's trade deficit with China reached approximately 89.3 billion euros in 2025. www.epochtimes.com · www.auto.cz
[● 2 SOURCES] Volkswagen has announced or faced reports of 50,000 job reductions. srnnews.com · krmg.com
[● 3 SOURCES] Germany plans to draft proposals for a tougher EU trade policy toward China by October. brusselsmorning.com · finanzmarktwelt.de · www.epochtimes.com