INVESTMENT volume guarantees provided by the German government to companies investing in China has collapsed this year, a government document showed, Reuters reports.

This highlights the impact of Berlin's efforts to end over-reliance on the country as only EUR51.9 million (US$56.26 million) in guarantees have been issued in 2023, according to the document. This is less than 10 per cent of the EUR745.9 million in guarantees issued last year.

China became Germany's biggest trading partner in 2016 and both countries prospered from Germany selling the precision machinery that let China become the main supplier of manufacturing goods to a globalised world.

Slowing growth, however, has dampened Germany's hopes, where officials fret that ever-more-advanced Chinese manufacturing poses a threat to Germany's economic model. Russia's 2022 invasion of Ukraine, which disrupted energy supplies, further heightened the dangers of reliance on a single partner.