Can Germany's pivot to Asia end its reliance on...China?

Now, you mentioned a lot of security, potential security projects, but that is not the only sector that the chancellor seems to be interested in.

And Stephen, if we look at what Germany's economic involvement looks like in Asia, we have China, which was Germany's biggest trading partner in 2025, over 250 billion euros in trade volumes last year.

That's six times larger than Japan, seven times larger than South Korea.

To me, it looks like there's room for improvement in the relation when it comes to trade.

What do you think? Do these markets have something to offer Germany? And are they big enough to sort of counterbalance what Germany may want to de-risk from China?

Those markets alone probably aren't big enough to counterbalance what they're getting from China.

The problem is it is a one-sided, it has become a one-sided trading environment between China and Germany.

And that's happened in recent years.

Really, if you look at the pandemic since about then, we've seen that the trade deficit with China has ballooned.

with Germany, but also with the entire EU to a point that it's very unsettling for not just Germany, but pretty much all countries.

Germany is really the country with which China has had the most intense relationship.

It's often said that if China was the workbench of the world, then Germany outfitted it during really the 2000s.

That relationship has shifted now.

It's changed.

China has gotten better at making a lot of the things that Germany once sold it.

Everyone probably knows about cars, for example.

But there are plenty of other areas, chemicals, machinery, things like that.

And so Germany is really trying to figure this out.

It also sees that it has strategic dependencies on China that it's very uncomfortable with, just like many other nations.

A key among them is critical raw minerals, critical raw materials.

So a group of minerals, materials that are used really for magnets and for electric applications, things like that, that are really key and are involved in defense production as well.

So what it wants to do with these nations is diversify, of course, and it can't solve everything with Japan, with Singapore, with South Korea, but it can begin to, as you said, try and find more like-minded partners, diversify, and perhaps solve some of these problems one at a time.

So kind of starting to do what financial advisors normally advise a normal person, diversify, diversify, diversify.

That's

right.