Strong China-Germany complementarities unlock vast economic possibilities

Editor's note: Yang Chengyu is an associate researcher at the Center for Promotion of Cultural Development of Chinese Academy of Social Sciences. The article reflects the author's opinions and not necessarily the views of CGTN. It has been translated from Chinese and edited for brevity and clarity.

Amid the ongoing restructuring of global industrial and supply chains, China and Germany, both manufacturing powerhouses, are at a critical juncture of transformation and upgrading. Germany has long advanced its Industry 4.0 strategy, focusing on digitalization and intelligent manufacturing, while China, during the 15th Five-Year Plan period, is set to spare no effort to foster new quality productive forces and accelerate the development of advanced manufacturing. In this context, the complementary strengths of the two countries' industrial sectors have become increasingly pronounced. Deepening pragmatic cooperation will not only provide sustained momentum for economic growth in both countries, but also consolidate the economic and trade foundations of bilateral relations, sending a positive signal to the international community in support of free trade and multilateral cooperation.

The complementarity between China and Germany stems from their differentiated advantages and structural demands in manufacturing. The integration of German technology with China's application scenarios has generated strong synergistic effects. Germany possesses profound technological expertise in high-end equipment, precision instruments, and industrial software, while its Industry 4.0 strategy has shaped a systematic technological pathway centered on industrial automation and the integration of complex production processes. China, for its part, boasts the world's most comprehensive manufacturing system and a vast domestic market. It has established leading advantages in new energy, energy storage, and electric vehicles, while also providing broad application scenarios for cutting-edge technologies.

In recent years, the Russia-Ukraine conflict, Europe's energy challenges, and uncertainties in certain countries' trade and economic policies have exerted sustained pressure on Germany's macroeconomic development. Against this backdrop, pragmatic cooperation with China has become an important pathway for Germany to enhance its economic resilience. In the field of intelligent manufacturing, German companies such as Siemens and Bosch have leveraged their core technologies to cooperate with Chinese enterprises, facilitating the transformation and upgrading of China's manufacturing sector. At the same time, the Chinese market provides an important platform for the commercialization and iterative development of German technologies, enabling both sides to move up the global value chain.

Moreover, the green transition has increasingly emerged as a new frontier for bilateral cooperation. China's large-scale production capacity in renewable energy generation and photovoltaics provides important support for Germany's green transformation, while Germany's extensive experience in low-carbon technologies and the circular economy offers valuable reference for China. Cooperative initiatives, including the lithium battery recycling partnership between BASF and CATL and the establishment of a joint research and development center in Shenzhen by Chinese and German teams, have advanced breakthroughs in long-duration energy storage technologies, achieving mutually beneficial outcomes in green industries of both countries.

It follows that deepening China-Germany economic and trade cooperation is an inevitable choice rooted in economic interdependence and structural demand. In 2025, China once again became Germany's largest trading partner. Two-way investment further reflects the depth of economic interdependence. Landmark projects including BASF's Verbund Technology Center in Zhanjiang, Volkswagen's R&D center in Hefei, and CARIZON, the joint venture between Volkswagen and Horizon Robotics focusing on advanced autonomous driving software and systems, have facilitated the free flow of capital, technology, and talent, serving as vivid examples of deep economic integration between China and Germany. Surveys by German chambers of commerce show that 93 percent of German enterprises in China remain committed to the Chinese market, with 53 percent planning to increase investment over the next two years.

From a development perspective, maintaining industrial chain stability and promoting manufacturing transformation and upgrading align with the shared interests of both countries. The strategic alignment between Germany's Industry 4.0 initiative and China's drive to develop new quality productive forces corresponds with the broader direction of global manufacturing development. While opportunities and challenges coexist, both sides should seek common ground while properly reserving differences, and deepen pragmatic cooperation to solidify the bilateral economic foundation. Strengthening mutual recognition of technical standards and enhancing industrial chain coordination will further unlock complementary advantages and inject sustained vitality into both economies.

The two-way drive between China and Germany is grounded in extensive complementarity and guided by the principles of mutual respect and win-win cooperation. Unilateralism and protectionism cannot derail the fundamental trajectory of cooperation. By focusing on key areas such as advanced manufacturing, green transition, the automotive industry, and the digital economy, and by deepening pragmatic cooperation and complementary strengths, both countries can enhance economic resilience and achieve their respective transformation and upgrading goals.