Fresh data from Destatis, released on February 6, 2026, presents a striking duality in Germany’s economic closure for 2025. On the trade front, December outperformed all expectations with a 4.0% surge in exports, reaching €133.3 billion and helping the country achieve 1.0% annual growth after two years of stagnation. This rebound was fueled by a significant 10.7% jump in exports to China and a resilient 8.9% increase in shipments to the United States, despite the 15% baseline tariffs implemented during the second half of the year. For the full year, the foreign trade surplus reached €202.8 billion, underscoring the enduring global demand for the „Made in Germany“ brand.
However, the industrial production data for the same period offers a sharp corrective to this export optimism. Real output in manufacturing declined by 1.9% in December, far exceeding analyst forecasts of a minor dip. This contraction was driven primarily by a steep 8.9% drop in automotive production and a 6.8% fall in machinery, highlighting the structural „friction“ between high global demand and domestic manufacturing constraints. For the diplomatic community, this paradox is the defining challenge of 2026: while Germany remains a global export powerhouse, its industrial heart is grappling with high energy costs and a difficult transition in the automotive sector, making fiscal stimulus and infrastructure investment—such as the new €500 billion Special Fund—more critical than ever for domestic stabilization.
Read the detailed data regarding Germany’s economy on Destatis and QNA.
The EU has launched the fourth phase of its Horizon Europe Africa Initiative, reinforcing research and innovation cooperation with African partners under the 2026–2027 work programme. The initiative focuses on areas where shared challenges demand joint solutions, including public health, climate resilience, digital transformation, food systems, and sustainable infrastructure. By aligning European research funding with African priorities, the programme aims to move beyond donor-recipient dynamics toward more balanced, long-term scientific partnerships.
For Germany, this matters on several levels. German universities, research institutes, and companies are among the most active participants in Horizon Europe, and stronger Africa-focused programmes open new pathways for collaboration, innovation, and knowledge exchange. At the same time, the initiative reflects Berlin’s broader foreign policy emphasis on Africa as a strategic partner rather than a peripheral actor, linking research cooperation to development policy, economic engagement, and global competitiveness. For readers of Diplomacy Berlin, this story was chosen because it shows how science and innovation are becoming tools of diplomacy, shaping Europe–Africa relations in ways that extend well beyond traditional aid frameworks.
Read more about the initiative on the European External Action Service website.
Tthe geopolitical stability of the Taiwan Strait is facing a „perfect storm“ in 2026, driven by a convergence of shifting U.S. priorities and domestic political cycles in both Beijing and Taipei. While many observers previously questioned the „Davidson Window“ – a prediction that China would attempt to control Taiwan by 2027 – Beijing’s calculus has been fundamentally altered by the perception of U.S. President Donald Trump’s non-interventionist stance. The recently released U.S. National Security Strategy, which prioritizes the Western Hemisphere and avoids designating China as a direct threat, has convinced Chinese leadership that Washington’s appetite for military intervention is at a historic low. This window of opportunity is further widened by the ongoing war in Ukraine, which continues to divert U.S. resources and attention away from the Pacific.
Beijing’s Calculation: Strategic Opportunity vs. Xi’s Legacy Internally, the pressure for „reunification“ is increasingly tied to Chinese leader Xi Jinping’s tenacious pursuit of a historical legacy as he approaches the end of his third term in 2027. Despite large-scale military purges that have raised questions about the People’s Liberation Army’s (PLA) readiness for a complex amphibious assault, Beijing believes that if U.S. intervention is off the table, the PLA can easily outmatch Taiwan’s forces. Simultaneously, a decline in the popularity of Taiwanese President Lai Ching-te and recent trade tensions between Washington and Taipei – including 20% tariffs and a mandatory $250 billion investment in U.S. chip production—have fueled Beijing’s hope that the Taiwanese public may be distancing itself from pro-independence parties. While no imminent mobilization is yet visible, the combination of a distracted West and a conservative CCP leadership nearing a critical succession year suggests that any perceived provocation could trigger a decisive campaign sooner than once imagined.
Read the full analysis on the Foreign Affairs website.
Germany is entering 2026 with trade and agriculture firmly back on the political agenda. As Berlin pushes ahead with plans to deepen free-trade ties with South America, the debate highlights a familiar tension in German policy: how to reconcile export-driven growth with environmental standards and domestic concerns from farmers and industry alike. The issue comes into sharp focus this week as International Green Week Berlin returns to the capital, bringing together policymakers, producers, and international partners to discuss food security, sustainability, and global supply chains. For Germany, the timing is telling.
Trade diversification beyond traditional partners has become a strategic necessity, while Green Week underscores how closely foreign trade, climate policy, and domestic politics are now intertwined. What once looked like separate debates are increasingly part of the same question: how Germany positions itself economically and politically in a more fragmented global order.
Read the full story on The Local de.
As of early 2026, Russia has significantly institutionalized its presence in Africa by transitioning from the semi-private Wagner Group model to the state-controlled Africa Corps, directly overseen by the Ministry of Defense. This shift marks a strategic move to secure long-term geopolitical influence and resource dependencies, particularly in regions like Mali, the Central African Republic, and Sudan. While Russia’s total trade volume with the continent—approximately $25 billion—remains modest compared to China or the U.S., its outsized impact is driven by a „security-for-resources“ exchange. By providing military training and regime protection in exchange for mining concessions and strategic access, Moscow successfully positions itself as an alternative to Western conditional aid, particularly for governments seeking to evade international sanctions or democratic oversight.
Russia’s broader economic strategy centers on long-term infrastructure and energy diplomacy, with Rosatom leading a massive push for nuclear sovereignty across the continent. Cooperation agreements now span over 20 nations, including major construction projects in Egypt and Nigeria, as well as new partnerships with Ethiopia and Niger. This energy-centric approach is complemented by „infrastructure diplomacy,“ where state entities propose comprehensive modernizations of transport networks, such as the 2025 agreement with Sudan to rehabilitate its railway and airport systems. By embedding itself in these vital national sectors, Russia aims to create decades-long technological and financial dependencies, ensuring its status as a global power in a multipolar world despite its ongoing economic isolation in the West.
Read the full article by Henrique Schneider on GIS Reports.
`On 3 December 2025, the European Commission launched the EU Agenda for Cities, a strategic framework aimed at empowering cities to tackle local challenges that contribute to broader EU goals. Recognizing that approximately 75% of the EU population lives in urban areas, the Agenda emphasizes cities as pivotal hubs for prosperity, innovation, social inclusion, and sustainable development. It aims to strengthen the territorial and urban dimensions of EU policies by promoting continuous dialogue with local authorities, simplifying support mechanisms through a consolidated EU Cities Platform, and enhancing strategic investment opportunities.
The Agenda addresses pressing urban challenges such as affordable housing, high energy costs, social segregation, climate impacts, and demographic shifts. It calls for better dialogue with city leaders, streamlined funding access via a single-entry web portal, and expanded investment through cohesion policy, the European Competitiveness Fund, Horizon Europe, and other instruments. Implementation starts under the current financial framework and will continue through the next programming period with initiatives like the European Urban Initiative Innovative Actions and regular reporting on the State of European Cities.
Executive Vice-President for Cohesion and Reforms Raffaele Fitto highlighted that the Agenda is built “with cities and for cities” to equip local leaders with tools to deliver tangible results, emphasizing that when cities lead, Europe succeeds by contributing 85% of EU GDP. This initiative complements existing frameworks such as the Territorial Agenda 2030 and the New Leipzig Charter and reinforces intergovernmental cooperation under the Urban Agenda for the EU.
Know more on the European Commission’s Regional Policy website.
Foreign Minister Johann Wadephul’s tour across Bosnia and Herzegovina, Montenegro, Albania, Serbia, Kosovo, and North Macedonia from 16–19 November underscores Berlin’s renewed attention to the Western Balkans. For Germany, the region is Europe’s geopolitical frontline — essential in countering Russian aggression and limiting Chinese influence amid the war in Ukraine. The visit builds on the Berlin Process summit in Belfast — the latest round of the EU-backed initiative promoting regional cooperation and reform, prioritising merit-based reforms in the rule of law, anti-corruption, and democratic standards, with frontrunners Albania and Montenegro earning praise for advances while others face calls for bigger change.
Energy diversification features prominently too, mirroring Germany’s shift from Russian gas: diversifying energy sources aims to strengthen long-term energy sovereignty and resilience, alongside vows to combat disinformation undermining EU alignment. For Berlin diplomats, this isn’t optional: a united Western Balkans fortifies EU borders, secures energy routes, and sustains the Berlin Process as a reform accelerator—essential as domestic scepticism tests Germany’s enlargement credibility.
Know more on the Federal Foreign Office’s website.
Germany’s new Circular Economy Strategy lays out an ambitious plan to reduce resource use, cut waste, and shift industry toward products designed to last, repair, and recycle. The framework pushes for stricter eco-design standards, more sustainable consumption, and a move away from the linear model that has kept emissions and material use high. It’s a recognition that climate policy alone won’t get Germany to its targets the country needs to rethink how it produces, uses, and disposes of goods across every sector.
The challenge is execution. Germany has strong environmental credentials on paper, but businesses still face slow permitting, uneven recycling infrastructure, and regulatory fragmentation that makes circular practices hard to scale. At the same time, Europe’s push for supply-chain resilience and green industry from critical minerals to electric mobility — depends on recovering far more materials domestically. The strategy is a step in the right direction; whether Germany can turn it into industrial reality will shape its competitiveness in a world where resources, emissions, and waste management are becoming core elements of economic security.
Know about the new Circular Economy Strategy Bundesumweltministerium’s website.
The article highlights a split in global business sentiment: SMEs in the Asia-Pacific region are growing more confident about trade, logistics, and cross-border expansion, while European SMEs — especially in major economies like Germany — remain hesitant. APAC companies are increasingly leveraging digital tools, e-commerce, and supply-chain diversification, whereas European firms cite high energy costs, inflation, and geopolitical uncertainty as reasons for their caution. According to a recent poll initiated by FedEx, APAC’s agility is giving it momentum, while Europe risks falling behind unless it accelerates digitalisation and strengthens supply-chain resilience.
Germany’s Mittelstand finds itself exactly in this position — squeezed by rising costs, a continued economic slowdown, and a global market moving faster than Europe’s regulatory and logistical environment. The contrast with APAC underscores Germany’s broader competitiveness challenge: German SMEs must adopt digital logistics, diversify suppliers, and adapt to a more volatile trade landscape if they want to remain competitive. The piece echoes wider concerns about Germany’s sluggish productivity, slow bureaucracy, and dependency on fragile supply chains — issues the government is now trying to address through major investment and industrial policy shifts.
Read the article in detail on SupplyChaindigital.com.
In the latest German Marshall Fund briefing, Noah Barkin examines how the power balance between Washington and Beijing is shifting and what that means for Europe. Despite expectations that Donald Trump’s second term would harden U.S. policy toward China, his administration’s inconsistent approach has instead strengthened Beijing’s hand. China’s recent deal with the U.S. over rare earth exports has left Europe exposed, particularly in critical industries like automotive and defense. The crisis surrounding Dutch chipmaker Nexperia illustrates how Europe’s dependency on Chinese technology and materials can quickly become a strategic vulnerability.
For Germany, the warning signs are flashing. Its car sector and military modernization plans depend heavily on access to rare earths and semiconductor components now caught in geopolitical crossfire. Yet Berlin’s slow response — delayed strategies, bureaucratic confusion, and a lack of clear direction from its new National Security Council suggests Europe’s largest economy is still struggling to define a coherent China policy. As Barkin notes, Germany “is staring at the train as it hits us.”
Read the full analysis on the German Marshall Fund website.
The European Centre for Press and Media Freedom (ECPMF), together with over 100 partner organizations, is urging the EU to make strategic, long-term investments in independent and public-interest media as part of the 2028–2034 Multiannual Financial Framework. Media freedom is not just a principle—it is the cornerstone of Europe’s democratic resilience. ECPMF highlights the need for sustainable funding, support for journalists, media pluralism, fact-checking, and reforms that ensure editorial independence while addressing market and digital platform challenges. Strengthening Europe’s media infrastructure safeguards informed public debate, reinforces democratic values, and fosters a resilient, transparent information ecosystem. As Europe’s democratic resilience depends on independent, trustworthy media, this goes beyond funding: strong, pluralistic media underpin evidence-based decision-making, protect democratic norms, and enhance Europe’s capacity to respond to hybrid threats.
This initiative underlines what institutions like the ECPMF stand for every day: protecting journalists, defending free expression, and safeguarding democracy against erosion and manipulation. As Europe faces growing hybrid threats, investing in free media is ultimately an investment in stability, transparency, and democratic security.
To know more, read the full story on the ECPMF website.
In the final episode of Brookings’ Foresight Africa podcast series from the 80th U.N. General Assembly, host Landry Signé spoke with policymakers and experts about how the United Nations continues to uphold its founding mission of preserving peace and security. Guests highlighted the UN’s work with fragile and marginalized states, from least developed to landlocked and small island nations, and its ability to provide platforms for negotiation, peacekeeping, and development support. Voices like Abdoul Salam Bello stressed the UN’s enduring relevance for 193 member states, while Commonwealth Assistant Secretary General Luis Franceschi underlined the need to defend multilateralism against polarization. Media perspectives, represented by Yinka Adegoke, reminded listeners that the UN’s convening power also shapes global narratives, while Gyude Moore emphasized energy access as a priority where consensus can still be forged. The discussion made clear that while multilateralism is under stress, the UN’s role as a forum for dialogue and peace remains irreplaceable.
Germany’s foreign policy identity is inseparable from this framework: its ability to influence international debates depends on strong multilateral institutions. The podcast most importantly helps highlight not only the UN’s role in global peace but also why Germany continues to anchor its diplomacy in defending and reforming the multilateral order.
Listen to the full podcast on Brookings.
The European Commission is pushing EU countries to implement key provisions of the Energy Efficiency Directive (EU/2023/1791) by 11 October 2025. The directive sets a binding target to reduce final energy consumption by 11.7% by 2030 compared to 2020 projections. Measures include prioritising energy-efficient solutions in new infrastructure, leading by example in the public sector, renovating at least 3% of public buildings annually, supporting vulnerable households, and promoting energy efficiency services. The Commission monitors progress via National Energy and Climate Plans and provides guidance to help member states meet these targets.
To read more about the Energy Efficiency Directive, visit the European Commission website.
The OECD’s 2025 Economic Survey on Germany stresses the urgent need for structural reforms to overcome challenges posed by global events and long-term issues. Key to this is guaranteeing medium-term fiscal sustainability by enhancing spending efficiency, reallocating funds, and broadening the tax base. Crucial attention must also be given to reforming the pension, health, and long-term care systems to address pressures from population ageing. To bolster economic growth, it is vital to tackle skilled labour shortages and reduce significant administrative burdens and regulatory barriers that impede business dynamism and innovation. The report further recommends improving regional development through better coordinating „place-based“ policies with industrial, infrastructure, and innovation strategies, while concurrently boosting the financial and administrative capacity of local municipalities.
Read the full survey and executive summary on OECD’s website.
During the 35th-anniversary celebration of German Unity on October 3rd, Chancellor Friedrich Merz called for national unity but delivered a stark warning: Germans must prepare for austerity to secure the country’s future.
Merz argued that Germany is „under attack“ from external and internal threats, requiring a major increase in defense capacity. To finance this, he warned that social promises would be „more difficult to uphold than they have been in the past,“ effectively signaling cuts to the social welfare system. He stressed citizens must „make a little more effort,“ tying economic sacrifice directly to national defense and stability, while also citing „irregular, uncontrolled migration“ as a source of domestic polarization.
To know more about it, visit the European Conservative official website.
President Trump’s decision to impose a $100,000 fee on employers applying for new H-1B visas has rattled Silicon Valley, where companies warn of an exodus of international talent. Forbes reports that European AI startups could be unexpected winners, suddenly in a stronger position to attract engineers, researchers, and founders discouraged by U.S. barriers. The development highlights how shifting immigration policy in Washington can reconfigure the global tech race. Germany, with its deep-tech ecosystem and demand for skilled talent, stands to benefit if it can streamline its own visa pathways and innovation incentives.
Read the full story on Forbes.
Germany’s parliament has passed the 2025 budget, allowing €116 billion in investments supported by a €500 billion infrastructure fund and special exemptions for defence spending. Finance Minister Lars Klingbeil called it a “huge paradigm shift,” aimed at boosting the economy and strengthening military support commitments to NATO and Ukraine. Defence spending will rise to 2.4% of GDP, though still below NATO’s new 3.5% target.
The total budget reaches €591 billion, combining core spending and special funds, with total borrowing projected at €143.2 billion. Chancellor Friedrich Merz’s coalition now faces challenging discussions for future budgets, including a €30 billion gap projected for 2027. Parliament will debate the 2026 draft next week. Read more on Reuters.
Between August 31 and September 1, 2025, the Shanghai Cooperation Organization (SCO) summit in Tianjin, China, and the subsequent WWII commemorative parade in Beijing showcased China’s rising diplomatic and strategic influence. Chinese President Xi Jinping, and Russian President Vladimir Putin projected unprecedented warmth, while Pakistan leveraged the summit to advance security concerns and bilateral ties with China, Iran, and Russia. The summit saw agreements on the SCO Development Bank, four new security centers, and cooperation in energy, capacity building, and the green and digital economies. Although the tangible outcomes remain limited, this week allowed China to assert global leadership, manage its partnership with Russia, and signal a multipolar world beyond traditional US-led frameworks. For a more in-depth analysis, read the full analysis by Stimson Center.
Recent data reveals that Europe’s trade landscape in 2025 is marked by robust exports ($2.18 trillion) and imports ($2.11 trillion) in Q1, with the EU holding over a third of global trade share. Agricultural exports grew by 3%, while imports soared 20%, signaling strong demand amid fluctuating commodity prices. The EU’s goods trade surplus has jumped to $191 billion, bolstered by resilient sectors like chemicals and manufacturing, while increased rail freight volume suggests diversified trade routes. Despite ongoing risks from US tariffs, climate regulations, and geopolitical tensions, Europe is positioned to leverage policy reforms, sustainable practices, and technology advancements to maintain its strategic autonomy and emerge as a leader in clean, smart global trade. Explore more detailed insights on TradeImeX.
The 17th BRICS Summit in Rio de Janeiro (July 2025) underscored the bloc’s push for multilateralism, international law, and a fairer global order. With 11 members including newcomers Indonesia, Egypt, Ethiopia, Iran, and the UAE—plus nine partners, leaders adopted a Joint Declaration with 126 commitments on hunger eradication, climate action, technology, peace, and security. Key economic outcomes included calls to reform IMF quotas and expand emerging economies’ role in global finance. The summit also condemned U.S. and Israeli military actions in Iran and Gaza, while backing peace efforts in Syria and Sudan. Read the takeaways and projections on the Stimson Center website.
Germany and Kenya’s migration agreement, signed in September 2024, sets up new legal pathways for skilled Kenyan workers, trainers, and students to move to Germany, while Kenya agrees to facilitate the repatriation of Kenyan nationals, including those with expired documents. Lauded as a win-win initiative, the pact reflects Germany’s pressing need to address its labor shortages amid demographic changes, and Kenya’s efforts to create opportunities for its youthful population, much of which faces unemployment. The deal exemplifies a blend of humanitarian rhetoric and realpolitik, offering coordinated, regulated migration and return procedures. Read more on Diplomacy Berlin’s website.
The 2025 US-EU trade deal, announced by President Donald Trump and European Commission President Ursula von der Leyen, sets a 15% tariff on nearly all EU exports to the US, including automobiles and manufactured goods, significantly lower than the previously threatened 30%. Key sectors like pharmaceuticals, semiconductors, timber, and copper will see phased tariff reductions, while tariffs on steel and aluminium remain at 50%, with plans to transition to a quota system. The EU commits to purchasing $750 billion in US energy products over three years and investing $600 billion in the US by 2029. The deal aims to reduce trade tensions and provide stability, but has faced criticism in Europe for its asymmetric terms that may impact EU competitiveness, particularly affecting German industries. For more details, see the full Reuters coverage here.
The 25th EU-China summit, held on 24 July 2025 in Beijing to mark 50 years of diplomatic relations, brought together EU leaders António Costa, Ursula von der Leyen, and Kaja Kallas with Chinese President Xi Jinping and Premier Li Qiang. The discussions covered bilateral relations, global challenges like climate change, and geopolitical issues. Although both sides committed to deepening cooperation on climate and multilateralism, the EU stressed the need for concrete progress on trade imbalances, market access, and fair economic relations built on reciprocity. The EU urged China to refrain from supporting Russia’s war in Ukraine and to promote peace based on international law. Human rights concerns and regional security issues, including tensions in the Taiwan Strait, were also reiterated by EU leaders. For full details, see the EU press release on the 25th EU-China summit.
Transatlantic economic ties now pivot as much on services as on goods, with digitally delivered sectors like intellectual property, business, and IT growing rapidly sometimes outpacing traditional goods trade, yet remaining undervalued in public debate and policy negotiations. The U.S. consistently runs a services trade surplus with the EU (€109 billion in 2023, according to Eurostat), driven by American strengths in finance, tech, and IP, while Europe’s goods trade surplus (€157 billion in 2023) reflects its industrial base. Despite some data discrepancies, the overall transatlantic trade relationship is remarkably balanced, with the difference between EU and U.S. exports standing at just 3% of total trade in 2023. The Kiel Institute Policy Brief No. 193 argues for reducing intra-EU services barriers, using services as a diplomatic tool in EU-U.S. talks, and, if necessary, deploying strategic measures like digital taxes or privacy rules emphasizing that services are now central to competitiveness, innovation, and the resilience of the transatlantic alliance. For the full analysis, see the Kiel Institute’s policy brief (PDF).
For anyone interested in the topic of lifestyle-based voter segmentation, the latest study by Jochen Roose for the Konrad Adenauer Foundation is a must-read. Based on Gunnar Otte’s sociological methodology, the study uses data collected in 2023 to create a typology of how different social groups engage with politics — across work, leisure, and everyday life. The findings are especially relevant for campaign planning. The study sheds light on how large specific target groups are, what political positions they tend to hold, and how they live day to day. It’s a valuable resource for developing targeted political messaging and strategy.
Given recent shifts in public opinion, one might expect even greater support for the AfD today — something to consider when interpreting the data. You can find the full study on the Konrad Adenauer Foundation’s website.
As the paper rightly points out, major digital and social media platforms are both competitors and collaborators for traditional media outlets. This dual relationship opens up meaningful avenues for regulation — particularly in shaping advertising markets and ensuring fair competition. (MB)
The D21 initiative has released its Digital Index for 2024/2025. The key message remains consistent with previous years: there is a clear connection between a person’s willingness to embrace digitalization and their personal prosperity. However, it’s important to note that this is not necessarily a direct cause-and-effect relationship, as many examples challenge this assumption.
The index highlights specific areas where Germany still needs to catch up in digital development. Ultimately, it’s up to each individual to take advantage of new digital opportunities. For the next government, the political challenge will be to create better incentives that encourage a more digitally engaged society.
You can find the full report and details here: D21 Digital Index 2024/2025.
A recent study conducted by the Friedrich Naumann Foundation and Demoskopie Allensbach sheds light on how Germans — especially young people — consume political information and how vulnerable they are to misinformation. The findings, although collected in December 2024, remain highly relevant.
The survey shows that public broadcasting continues to be the main news source for 64 percent of respondents, but half also express distrust in the media overall. Among those aged 16 to 35, social media plays a far greater role — with YouTube emerging as a particularly important platform.
Equally notable are the opinions on key political topics. Only 30 percent of respondents expressed support for continued aid to Ukraine, and climate protection met with increasing skepticism. These insights highlight the growing challenge of political communication in a fragmented media environment.
You can explore the full survey results and download the data here: Friedrich Naumann Foundation – Survey on Disinformation