Merz and Macron push Beijing on yuan appreciation to close EU’s €360B trade gap

The EU’s trade deficit with China hit roughly €360 billion in 2025. That works out to about €1 billion leaving Europe every single day, and German Chancellor Friedrich Merz and French President Emmanuel Macron have decided they’ve seen enough. At a joint press conference near Cologne on July 17, 2026, the two leaders presented a unified front, arguing that the yuan is significantly undervalued and that Beijing’s subsidies and industrial overcapacity are distorting global trade in ways that systematically disadvantage European producers. They tasked their ministers with building a comprehensive roadmap, due in September 2026, to address these imbalances and explore what they diplomatically called “emergency measures.” The numbers behind the frustration Germany’s bilateral deficit with China has grown nearly fourfold since 2020, driven by surging Chinese imports on one side and weakening German exports on the other. China’s goods surplus with the EU reached approximately $687 billion between January and July 2026 alone, according to customs data. Every EU member state now runs a deficit with China. That unanimity of pain is politically significant: it makes it harder for Beijing to p...