Germany needs to diversify its business interests in Asia to reduce its dependence on China, Economy Minister Robert Habeck told DW in Singapore.

According to him, the war in Ukraine helped demonstrate the need for diversification.

"We are, of course, interested in trade with China, but not in stupid trade with China," Habek said.

"The general strategy is completely clear," Habeck said. "We want to protect our critical infrastructure. We want to protect our sectors where critical goods and knowledge are developed. And beyond that, of course, we want to have a trade relationship with China. It's not decoupling." He noted that Germany's approach has been a little softer than that of the U.S. "I know that the US is sometimes saying harsher words, and this is not our way," he said. "So where it's unproblematic, it's not a problem to have trade with China. But in the problematic areas, we have to be more careful than we have been before."

This week, the German government suspended China's purchase of two semiconductor or computer chip companies, saying they risk losing know-how in a critical sector where Beijing is rapidly expanding its influence.

"Goods that come from critical sectors like telecommunications, energy sector, chips and semiconductors must be protected," Habeck said. "This does not mean that there's no possibility to do business. But we have to take care that we have [our] own sovereignty in this field. And this is how we are acting now."