France and Germany plan joint roadmap on China trade imbalance

France and Germany want "to have a Franco-German roadmap on this issue by September", Emmanuel Macron announced near Cologne. The agreement signals a shift in Berlin's traditionally cautious approach toward Beijing. Because German businesses are heavily invested in China, Germany has long acted as a brake on France's push for tougher trade measures.

The new alignment is driven by a sharply worsening trade picture. "I think it goes without saying that we have to address this imbalance, because it comes at the expense of our industry," Friedrich Merz warned. The 27-country bloc's trade deficit in goods with China hit around 360 billion euros in 2025.

That industrial pressure is already being felt across the continent's core manufacturing base. "We want to protect our companies and our industries. We've seen it in chemicals, we see it in machine tools, in the automotive sector and in many others," Macron said. He noted that Europe is "right now being shaken" by Chinese trade practices.

To counter this influx, Paris and Berlin intend to force the issue at the EU institutional level. "We are going to push again very strongly to reinforce the mandate given to the European Commission to move much faster on market investigations and on these instruments to protect our industries," Macron stated. For businesses and investors, a reinforced mandate could mean swifter deployment of trade defense instruments.

Beyond industrial subsidies, the two leaders targeted China's allegedly undervalued currency as a central factor making its products cheaper. Macron urged dialogue with Beijing "on exchange rates and the opening of financial markets." Merz framed the issue as a test of Beijing's fairness, stating that "if the Chinese currency is currently correctly valued, then there is no reason not to allow it to be freely convertible for trading purposes."