Europe
2026.02.24 23:55 GMT+8

Why Germany can't go green, or stabilize its economy, without China

Updated 2026.02.24 23:55 GMT+8
Peter Oliver in Berlin, Germany

Germany is accelerating its offshore wind rollout as it seeks to power energy-hungry industries and stabilize its slowing economy. 

As Chancellor Friedrich Merz prepares to travel to China, energy cooperation is expected to be high on the agenda, with Berlin increasingly reliant on Chinese technology to drive its green transition.

European leaders have already agreed to work more closely on offshore wind development, signing a cooperation deal in Hamburg last month. Speaking at the event, Merz said offshore energy is becoming significantly more efficient, adding that closer coordination would be needed on wind, hydrogen and energy network planning.

Germany's renewable expansion, however, depends heavily on imported technology. The vast majority of solar panels and components installed across Europe are supplied by Chinese manufacturers. 

Berlin is also reliant on China for around 90 percent of the rare earth magnets used in wind turbines, a dependency that is expected to grow as capacity expands.

Dr Claudia Kemfert, an energy economist at the German Institute for Economic Research, says that reliance on imports is set to deepen. She notes that Germany is already importing large volumes of solar modules and will become increasingly dependent on foreign supply chains as electric mobility expands, particularly for battery technology and the raw materials required for turbine production.

Berlin faces mounting pressure to secure affordable power while staying on course with decarbonization goals. /Thilo Schmuelgen/Reuters

Chinese technology already plays a central role in Germany's energy transition, prompting some analysts to argue that cooperation, rather than decoupling, is the pragmatic option. 

Dr Michael Borchmann, former head of European and international affairs for the German state of Hesse, says German industry is not currently well positioned to finance the transition alone and requires substantial investment. 

He argues that China's long-term environmental planning makes it a natural partner, especially compared with alternatives elsewhere.

Energy costs remain a major pressure point for German manufacturers. Electricity prices are among the highest globally, eroding competitiveness and weighing on industrial output. Those costs are also shaping domestic political debate.

With the far-right Alternative for Germany gaining ground in opinion polls, energy policy has become a central line of attack. AfD energy spokesman Stefan Kotre has criticized what he describes as a shift towards a planned energy economy and has called for a return to nuclear power, arguing it is cheaper and more reliable.

After two years of economic contraction, Germany's economy grew by around 0.2 percent last year, a modest recovery still constrained by high energy prices and weak industrial performance.

As Chancellor Merz prepares for talks in Beijing, securing affordable energy and reliable access to green technology may prove decisive in determining whether Germany can build on that fragile growth and sustain its industrial base in an increasingly competitive global economy.

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