Merz in Asia: Europe's middle-power pitch

<p><em>Special Reporting from LSN News, adapted from today's Asia Unfiltered episode. <a href="https://youtu.be/yRj7Xo4OBng" target="_blank" rel="noopener">Watch the video on YouTube.</a></em></p>

<p>German Chancellor Friedrich Merz is touring Asia with an offer, not just a speech. After stops in Singapore and Tokyo this week, he arrives in Seoul on Thursday, carrying a simple message: Europe and Asia's middle powers should stop waiting for Washington or Beijing and start building their own club. The question for Asia is whether that offer is real, or just a sales tour.</p>

<h2>What happened in Tokyo</h2>

<p>On Wednesday, Prime Minister Sanae Takaichi and Chancellor Merz met at the Prime Minister's Office and issued a leaders' declaration on economic security and advanced technology. According to Kyodo News, the two leaders agreed to beef up supply chains for critical minerals and to promote defence industrial cooperation. Jiji Press reports that they also set up a high-level dialogue on artificial intelligence, and that around 30 German executives travelled with Merz, with 33 memorandums due to be signed in fields such as AI and nuclear fusion. Jiji also reports that Merz urged the countries and regions concerned to act with caution in the Taiwan Strait.</p>

<p>Earlier, at a business summit in Tokyo, Merz went further. Reuters reports that he urged Japan to back a proposed alliance of like-minded partners to resist tariffs and economic coercion. If the rules are violated by others, or if economic coercion is used, he said, the alliance could "present a united front." Borrowing a line from Canada's Mark Carney, he said the question would no longer be whether such partners are on the menu or at the table, "because in that case, the restaurant itself belongs to us."</p>

<h2>Why the trip matters for Asia</h2>

<p>In Singapore on Tuesday, delivering the 49th Singapore Lecture at the ISEAS-Yusof Ishak Institute, Merz declared: "We stand on the threshold of a new geopolitical era." He proposed an agreement between the European Union and the 12 members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which together with the EU, he said, account for more than a third of global trade. He also backed a faster free trade deal between the EU and ASEAN: "I am in favor, provided we have enough in common to do it fast."</p>

<p>On China, he was careful. He called full decoupling "a mistake" that "would make us neither safe nor more prosperous," but said Europe and Asia must cut "unhealthy, one-sided dependencies" in supply chains, technology and raw materials. Germany has reasons to look east beyond China: Reuters cites a report that Germany's trade deficit with the Asia-Pacific is on track for a record of nearly 146 billion euros this year, as falling exports to China outweigh growth elsewhere.</p>

<p>Beijing's response was measured. Foreign Ministry spokesperson Guo Jiakun said China hopes Germany and the EU will remain "objective and rational" and become reliable and predictable partners, resolving differences through dialogue.</p>

<p>But there is an awkward part. At the same Tokyo business summit, Japan's trade minister Ryosei Akazawa told Merz directly that Japan is strongly concerned that a proposed EU preference for European-made electric vehicles could shut Japanese electric vehicles out of the European market, according to Reuters. Europe is asking Asia to stand together against protectionism while debating protectionism of its own.</p>

<h2>The Unfiltered verdict</h2>

<p>This is a genuine strategic shift, not a photo opportunity. A joint declaration with Japan, defence industrial cooperation, a critical minerals agenda and a concrete trade architecture built on the CPTPP and ASEAN go well beyond the usual speeches. For Asia's middle powers, from Singapore to Seoul, a second big buyer and technology partner reduces their exposure to pressure from both Washington and Beijing.</p>

<p>But the offer is only as good as Europe's follow-through. Europe has talked about an ASEAN trade deal for years, and the car rule Tokyo complained about shows how quickly European industrial politics can undercut European trade rhetoric. Germany still sees China as both a massive trading partner and a strategic rival, as Reuters puts it, which means Berlin will hedge just as Asian capitals do.</p>

<p>Our read: Asia should take the offer, but price it. Sign the minerals and defence projects that deliver now, push the EU to drop measures that hit Asian exporters, and treat the bigger trade alliance as a promise until there is a text and a timeline.</p>

<p>What to watch next: Merz's summit with President Lee Jae Myung in Seoul on Thursday, where Yonhap says batteries, semiconductors, AI and the defence industry are on the agenda, and whether the EU moves on the electric vehicle preference that Tokyo has now raised at the highest level.</p>

<h2>Sources</h2>

<ul>

<li><a href="https://live.euronext.com/en/financial-news/germanys-merz-proposes-wider-eu-asia-market-access-counter-trade-restrictions" target="_blank" rel="noopener">Reuters (Andreas Rinke, Xinghui Kok), &quot;Germany&#x27;s Merz proposes wider EU-Asia market access to counter trade restrictions&quot;, via Euronext Live</a></li>

<li><a href="https://live.euronext.com/en/financial-news/merz-invites-japan-back-trade-alliance-china-asks-germany-be-rational" target="_blank" rel="noopener">Reuters (Andreas Rinke), &quot;Merz invites Japan to back trade alliance as China asks Germany to be &#x27;rational&#x27;&quot;, via Euronext Live</a></li>

<li><a href="https://topics.smt.docomo.ne.jp/article/reuters/world/reuters-20261028107" target="_blank" rel="noopener">Reuters Japanese (Kentaro Okasaka), &quot;独首相、先端技術での協力拡大呼び掛け 経産相は日本製ＥＶ排除に懸念表明&quot;, via d menu news</a></li>

<li><a href="https://www.devdiscourse.com/article/international/3998563-germany-japan-should-jointly-pursue-new-tech-markets-merz-says" target="_blank" rel="noopener">Reuters via Devdiscourse, &quot;Germany, Japan should jointly pursue new tech markets, Merz says&quot;</a></li>

<li><a href="https://english.kyodonews.net/articles/-/89689" target="_blank" rel="noopener">Kyodo News, breaking (english.kyodonews.net)</a></li>

<li><a href="https://english.kyodonews.net/articles/-/89690" target="_blank" rel="noopener">Kyodo News, breaking (english.kyodonews.net)</a></li>

<li><a href="https://sp.m.jiji.com/article/show/3899356" target="_blank" rel="noopener">Jiji Press, &quot;日独首脳、経済安保で共同宣言＝防衛・ＡＩで協力拡大&quot;</a></li>

<li><a href="https://www3.nhk.or.jp/nhkworld/news/20261028de66742/" target="_blank" rel="noopener">NHK World-Japan, &quot;Takaichi, Merz to meet in Tokyo to discuss cooperation&quot;</a></li>

<li><a href="https://www.zaobao.com.sg/en/news/world/merz-urges-deeper-europe-asia-trade-and-frontier-tech-ties-rejecting-china-decoupling-and-seeking" target="_blank" rel="noopener">Lianhe Zaobao, &quot;Merz urges deeper Europe-Asia trade and frontier tech ties&quot;</a></li>

<li><a href="https://mothership.sg/2026/10/german-chancellor-friedrich-merz-singapore-lecture/" target="_blank" rel="noopener">Mothership, &quot;German Chancellor Friedrich Merz says he&#x27;d like to take learnings from S&#x27;pore&#x27;s NS to Germany&quot;</a></li>

<li><a href="https://www.globaltimes.cn/page/202610/1373133.shtml" target="_blank" rel="noopener">Global Times, &quot;China urges Germany, EU to be objective, rational after Merz&#x27;s claim of &#x27;unhealthy&#x27; dependence&quot;</a></li>

<li><a href="https://en.yna.co.kr/view/AEN20261023010100315" target="_blank" rel="noopener">Yonhap, &quot;German Chancellor Merz to visit S. Korea next week for summit with Lee&quot;</a></li>

</ul>