China Trade Deficit to Hit Record High, Risking German Backlash

Germany’s trade gap with China is projected to reach a historic peak in 2025. Analysts warn this could fuel protectionist sentiment in Europe's largest economy. The deficit is widening because Chinese exports to Germany are growing much faster than German exports to China. A forecast last week from Germany Trade & Invest (GTAI), a federal economic agency, predicts China's exports to Germany will rise 7.2% to €168 billion (US$197 billion). China is already Germany's top import partner. Meanwhile, demand for German goods in China is shrinking. This trend shows no sign of reversing soon. Economists say the sustained and record-breaking deficit may trigger a political backlash. German leaders could face growing pressure to adopt more protectionist trade measures against Chinese imports.