On Monday, German Chancellor Friedrich Merz warned that Beijing is preparing to exploit Germany’s “trade vulnerabilities” and urged prioritizing reducing reliance on raw materials from China.
Merz advocates for signing more free trade agreements with countries like India, Indonesia, Brazil, Mexico, and Argentina to lessen Germany’s dependence on China.
Speaking at a German diplomats conference in Berlin, he said, “Dependency makes us vulnerable to (Chinese) blackmail.” He plans to visit China for the first time in the coming weeks.
Merz emphasized, “In our policy towards China, we will seek cooperation as much as possible – for example on climate policy issues, global crises, and many other challenges. But at the same time, we must recognize that systemic competition is intensifying.”
“To ensure security and competitiveness, and in line with our strategic sovereignty interests, Germany must prioritize diversifying raw materials and trade supply chains,” he added.
In recent years, with the increasing demand for key mineral resources such as nickel, cobalt, graphite, and rare earths in electric vehicles, batteries, renewable energy, and military equipment, ensuring stable supply of these raw materials has become a top priority for governments worldwide.
According to a May report by the International Energy Agency, challenges in securing mineral supply have become more severe due to the increasing concentration of mineral production in a few countries like China, along with export restrictions driven by geopolitical factors.
Compared to the previous two German Chancellors – Social Democrat Olaf Scholz and conservative colleague Angela Merkel, Merz has taken a tougher stance towards Beijing, warning of the risks of over-reliance on China multiple times.
In his speech on Monday, he mentioned that the EU plans to approve other free trade agreements outside the Southern Common Market by the end of the year, which will help reduce the EU’s dependence on China.
“We need more and closer partnerships, especially with India, Indonesia, Brazil, Mexico, and Argentina. But we also need to establish partnerships with countries in Latin America, Africa, and Asia outside the G20,” Merz said.