Berlin: Germany is taking a fresh look at its relationship with China after growing trade pressures exposed how dependent the country has become on key imports from Beijing. The German parliament has formed a new expert commission that includes industry leaders, labour representatives and policy analysts to study the country’s vulnerabilities and suggest practical steps to fix them.

The move comes as Germany faces increasing challenges in its economic ties with China. Recent export restrictions from Beijing, especially on rare earth materials that Germany relies on for its automotive and technology industries, have highlighted the risks of depending on a single source. Officials say around four fifths of the rare earths used in Germany come from China.

Germany has had an official China strategy since 2023, describing China as a partner, competitor and systemic rival. But critics say this strategy has had little real impact and that Germany’s level of dependence on Chinese supply chains has barely changed. This concern has grown at a time when the country is struggling with slow economic growth and rising competition from China in areas such as chemicals, batteries and electric vehicles.

Recent forecasts from Germany’s Council of Economic Experts show weak growth ahead, predicting only 0.9 percent expansion in 2026. Trade numbers also paint a troubling picture. Germany is expected to record a trade deficit of about 87 billion euros with China this year, driven by falling exports and rising Chinese imports.

European companies, including Chinese firms operating in the region, report that the business climate in Europe has become tougher due to tighter regulations and growing political scrutiny. At the same time, German industries like chemicals and manufacturing warn that low cost production and over capacity in China are making it harder for European companies to compete.

Chancellor Friedrich Merz is facing increasing pressure to respond with concrete measures. The new commission will study Germany’s reliance on Chinese raw materials, energy supplies and investments in critical infrastructure. Its findings may lead to new laws targeting imports, foreign ownership and supply chain risks.

Analysts say Germany’s shift could signal a broader change in Europe’s approach to China. The outcome will be closely watched by businesses and governments on both sides as Germany prepares for what may be a significant reset in one of its most important economic relationships.