Merz at the Korean DMZ Voices Hope for Reunification as Steinmeier Courts Beijing and Germany's Inflation Eases

On Friday, October 30, Chancellor Friedrich Merz stood briefly on North Korean soil, inside a barracks building at Panmunjom, the truce village on the demilitarized zone that splits the Korean Peninsula. North and South Korea have been divided since hostilities ended in 1953, and the border there is among the most heavily fortified in the world.

Speaking to reporters, Merz recalled Germany's own reunification 36 years ago. "Let us hope that Korea too gets the chance one day to regain state unity," he said. He added that the suffering a country endures from division, and the strength of the wish to end it, can be felt at the site, at least on the southern part of the peninsula. During his stay in Seoul, he said, he had been asked about the German experience of reunification.

The hope sits against a hard backdrop. In recent years North Korea has stepped back from diplomacy with the South. It has officially removed language calling for reunification from its constitution and redefined the South's status as that of a "hostile state."

Merz's stop in Korea was one leg of a tour that also took him to Japan and Singapore, where he promoted closer cooperation among what he calls the world's "middle powers." At the same time, President Frank-Walter Steinmeier was in China, so Berlin was working two tracks across Asia. Taken together, the visits show an effort to reduce risk without decoupling from Beijing.

Steinmeier's trip was a four-day state visit of a kind rarely seen now. He began in Hefei, where Volkswagen's China operations are headquartered, then moved through historic villages and the Yellow Mountains, visited sites of Chinese history, art and science, and ended at Tiananmen Square in Beijing. Steinmeier, who leaves office in March 2027, has known Xi Jinping for many years. DW's assessment is that his mix of respect and criticism provoked no visible outrage in Beijing.

On economics, there was some movement. When Steinmeier raised Chinese export subsidies and the resulting trade deficit with Europe, Xi said he was ready to open a "new chapter" in the comprehensive strategic partnership. He described China and Germany as the world's second- and third-largest economies, with a responsibility for relations between China and Europe and for stable global growth. He also spoke of an "all-dimensional strategic partnership" and said the new approach favors "openness over closure, and cooperation over confrontation." DW's reading is that this is not a breakthrough but does sound like an understanding, and it notes that a weakened Europe would also strain China's economy. How much willingness lies behind the words will show in EU-China negotiations.

On international order, Steinmeier got less. He told Xi that both countries bear responsibility for the conditions under which states shape their relations, and he raised global conflicts, including Russia's war in Ukraine, several times. He received no response in official statements. That evening, CCTV's news channel reported only on his visit to an astrophysics institute, with no mention of his call for China, as a permanent UN Security Council member, to do more for peace.

At home, Germany's annual inflation rate eased to 2.8% in October from 3.3% in September, according to preliminary figures from the Federal Statistical Office. Economists credited a fuel tax cut that took effect in October and runs through December. Energy prices were up 12.2% on the year, down from 14.9%; services inflation slowed to 2.5%, and food inflation stayed at 0.4%. Silke Tober of the Macroeconomic Policy Institute called the tax cut the decisive factor. KfW economist Stephanie Schoenwald warned that gas and oil prices have risen significantly again, citing continuing conflicts and lower inventories, so the relief may prove temporary.

The next test of Berlin's Asia approach will be the EU-China talks, where Xi's warm language will be measured against concrete concessions on trade.