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Germany's Merz says challenges remain as he concludes inaugural China trip

Published by Global Banking & Finance Review®

Posted on February 26, 2026

1 min read

Last updated: February 26, 2026

Germany's Merz says challenges remain as he concludes inaugural China trip - Finance news and analysis from Global Banking & Finance Review

Tags:Manufacturing global economy

Quick Summary

German Chancellor Friedrich Merz ended his first China trip in Hangzhou after talks with Xi Jinping and Li Qiang. He noted progress but warned Chinese overcapacity is straining EU competition and asked Economy Minister Katherina Reiche to follow up.

Merz Ends First China Visit, Says Challenges on Competition Persist

Meetings with Xi and the Premier

Trade and Competition Takeaways from Merz's China Trip

HANGZHOU, China, Feb 26 (Reuters) - German Chancellor Friedrich Merz said he had held successful talks with Chinese President Xi Jinping and his prime minister but challenges including Chinese overcapacity remained to be worked out between the countries.

Implications for European Markets

Concerns Over Chinese Overcapacity

"Above all, there are issues relating to competition - China has high capacities, some of which are now also posing a problem for Europe because they far exceed market demand," he said in Hangzhou at the end of his inaugural visit to China.

Follow-Up: Economy Minister's Visit

"We will have to discuss this in detail after my visit," he said, adding that he would ask Economy Minister Katherina Reiche to also visit China.

Reporting and Editing Credits

(Reporting by Andreas Rinke, Writing by Friederike HeineEditing by Ludwig Burger)

Key Takeaways

•Friedrich Merz concluded his inaugural visit to China with talks in Hangzhou.
•He said discussions with Xi Jinping and Premier Li Qiang were successful overall.
•Merz flagged Chinese industrial overcapacity as a key challenge for Europe.
•Further detailed talks are planned after the trip to address competition issues.
•Merz will ask Economy Minister Katherina Reiche to visit China for follow-up.

Frequently Asked Questions about Germany's Merz says challenges remain as he concludes inaugural China trip

1What is the main topic?

Germany’s Chancellor Friedrich Merz concluded his first visit to China, reporting constructive talks while highlighting ongoing challenges such as Chinese industrial overcapacity.

2Why is Chinese overcapacity a concern for Europe?

Merz says China’s high production capacity exceeds market demand, creating competitive pressure on European industries and complicating fair-market conditions.

3What are the next steps after the trip?

Merz plans detailed follow-up discussions and intends to ask Economy Minister Katherina Reiche to visit China to continue talks on competition and trade issues.

Trade and Competition Takeaways from Merz's China Trip

Implications for European Markets

Concerns Over Chinese Overcapacity

Follow-Up: Economy Minister's Visit

"We will have to discuss this in detail after my visit," he said, adding that he would ask Economy Minister Katherina Reiche to also visit China.

Reporting and Editing Credits

(Reporting by Andreas Rinke, Writing by Friederike HeineEditing by Ludwig Burger)

Key Takeaways

•Friedrich Merz concluded his inaugural visit to China with talks in Hangzhou.

•He said discussions with Xi Jinping and Premier Li Qiang were successful overall.

•Merz flagged Chinese industrial overcapacity as a key challenge for Europe.

•Further detailed talks are planned after the trip to address competition issues.

•Merz will ask Economy Minister Katherina Reiche to visit China for follow-up.

Frequently Asked Questions

1What is the main topic?

Germany’s Chancellor Friedrich Merz concluded his first visit to China, reporting constructive talks while highlighting ongoing challenges such as Chinese industrial overcapacity.

2Why is Chinese overcapacity a concern for Europe?

Merz says China’s high production capacity exceeds market demand, creating competitive pressure on European industries and complicating fair-market conditions.

3What are the next steps after the trip?

Merz plans detailed follow-up discussions and intends to ask Economy Minister Katherina Reiche to visit China to continue talks on competition and trade issues.