German businesses are experiencing growing competitive pressure from Chinese rivals, according to a survey released Thursday by the German Chamber of Commerce and Industry (DIHK). The findings underscore the challenges facing Europe’s largest economy as it navigates trade tensions and structural shifts in global supply chains.
The survey, which polled 1,300 companies, found that two-thirds reported increased competition from Chinese competitors, with 83% of industrial firms citing the same. Nearly 88% of respondents indicated that exiting their respective markets was not a viable option. To counter the pressure, 60% of companies are prioritizing product innovation, while 50% are focusing on cost reduction. Another 39% are exploring new markets, and nearly one-third are pursuing deeper collaboration with Chinese partners.
The trade imbalance between Germany and China has widened, with the deficit expanding by approximately €22 billion last year to reach €89.3 billion. German imports from China rose by 8.8%, while exports to China declined by 9.7%, reflecting shifting trade dynamics. DIHK’s Director of Foreign Trade, Volker Treier, noted that competition with China has entered a new phase, stating that Chinese firms are no longer competing solely on price or volume but are also advancing technologically and expanding their international presence.
The survey’s release coincides with preparations for EU negotiations with Beijing scheduled for October. The findings highlight the urgency for German and European policymakers to address structural challenges in trade and industrial competitiveness amid China’s rising influence in global markets.
