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There is always good reason to worry about the Chinese property market, but unlike those of other fully urbanized major economies, China's housing market enjoys ample support from the demand side, he noted.

Recent plans require great improvements in efficiency and quality of regulation, with more resources diverted into weak areas. Direct financing will be prioritized while indirect financing will be improved through the transformation of major state-owned banks and by making better use of smaller banks and private financial institutions.

In an interview with Xinhua, Chinese Ambassador to Germany Shi Mingde said China hopes that the upcoming G20 Hamburg summit will continue to encourage openness of the world economy in a bid to counter protectionism, and push growth through innovation and structural reform, instead of only using fiscal and monetary tools.

Zhang also said he hoped that the two countries could enhance political mutual trust and strategic coordination while accommodating each other's core interests and major concerns.

For her part, Merkel said the German people have made great efforts to provide a comfortable home for the long-awaited pandas.