China surpasses Germany in Polish imports as G20 ministers clash over steel subsidies

Chinese imports surpass German deliveries

In July 2026, China surpassed Germany as the largest monthly exporter of goods to Poland, marking the first time Germany lost the top supplier position in 35 years since the fall of the Berlin Wall. Figures released by the National Bank of Poland show that this import shift stemmed from increased deliveries of computer equipment, passenger vehicles, and durable goods. German exports to Poland had previously sustained German foreign trade, rising 9.2% during the first half of 2026 to reach €53.8 billion. Over the same six-month timeframe, German exports to China fell 12.2% to €36.3 billion. Although analysts cited by the Frankfurter Allgemeine Zeitung noted the monthly change could reflect temporary factors, it reflects expanding Chinese manufacturing reach and the absorption capacity of Poland's growing domestic market.

Strategic rail corridors and security policies

Warsaw continues to balance commercial expansion with strategic defense considerations, subordinating purely economic choices to regional security interests. The Polish government maintains regulatory curbs against Chinese technology, including specific limits on telecommunications systems and a ban prohibiting Chinese-manufactured cars from entering Polish military bases. Poland has also cultivated parallel commercial and industrial partnerships with Taiwan in critical technology sectors, including unmanned aerial vehicles, semiconductors, and electric vehicles. Concurrently, Poland functions as the primary overland artery for transcontinental commerce, handling 90% of all freight trains traveling between China and the European Union. Konrad Szatters from China Observers in Central and Eastern Europe calculates that this rail transit corridor represents approximately €25 billion in annual trade flow. These trade developments take place alongside domestic fiscal pressures, as Poland recorded an inflation rate of 3.4% in August and faces a projected budget deficit exceeding 7% of gross domestic product in 2027.

Steel tariffs and the G20 trade talks

Trade representatives from the Group of 20 nations gathered in Milwaukee to deliberate over distorted manufacturing practices and government subsidies, with a primary focus on Chinese industrial policy. United States and European Union delegates argued that extensive state subsidies disrupt market competition and displace Western industrial firms, especially in metallurgy. In her annual State of the European Union address, European Commission President Ursula von der Leyen previously pledged to defend the European single market against unfair external competition. Poland actively lobbied European authorities for protective measures, resulting in higher import tariffs and reduced quotas that took effect across the European Union on 1 July 2026. Polish Economy Minister Andrzej Domański attended the Milwaukee talks to defend heavy industry and European manufacturing resilience.

This is a heavy industry sector that is very difficult to rebuild after a potential slowdown. That is why Poland is very keen for the steel industry to remain strong in Poland and in Europe. Metallurgy is of key importance in securing Poland's economic and military sovereignty and resilience.

Bilateral deadlock on market access

During the Milwaukee ministerial, Domański held bilateral talks on the sidelines with China's international trade representative, Li Chenggang. The Polish minister urged Beijing to open Chinese domestic markets to more Polish goods and raised ongoing concerns regarding steel output, but the conversation concluded without tangible commitments. Meanwhile, a coalition of member countries participating in the Global Forum on Steel Excess Capacity adopted a joint action plan in Milwaukee to tackle structural market imbalances. Domański stated following the meeting that finding common ground with Chinese counterparts on steel production policies remains highly improbable.

Reaching an agreement with Beijing on this issue will be very difficult. We failed to reach a consensus in Milwaukee and, we must realize, this is unlikely to succeed.