EU-China Trade Tensions: Europe Prepares Tougher Response to Beijing
The European Union is weighing a tougher trade response to China as its goods deficit crosses $400 billion, raising concerns over jobs, subsidies and industrial competitiveness.
The European Union is preparing for a tougher trade stance towards China as its massive goods deficit with Beijing fuels growing concerns about jobs, subsidies and the future of European industry.
European Commission trade chief Maros Sefcovic is set to hold talks in Beijing with Chinese Commerce Minister Wang Wentao, with the EU pushing for progress on reducing its roughly €360 billion ($410 billion) trade deficit with China.
Pressure for action is mounting inside the 27-member bloc. The European Parliament has backed a resolution calling for greater economic reciprocity and a proportionate response if China fails to open its markets further. Possible measures range from additional tariffs to the EU’s Anti-Coercion Instrument, which allows restrictions on trade and investment in response to economic pressure.
European industries including steel, electric vehicles, batteries, solar equipment, chemicals and machinery are facing increasing competition from Chinese producers. Policymakers fear heavily subsidised Chinese exports could accelerate factory closures and job losses.
France and Germany have called for a broader rethink of EU-China trade policy, although member states remain divided. Spain, for instance, has favoured a less confrontational approach.
China has warned that protectionism and supply-chain decoupling would hurt both sides. Chinese exports to the EU rose sharply this year, while Beijing has also opened an anti-dumping investigation into a European chemical product.
With China relying heavily on exports and Europe remaining dependent on Chinese goods, both sides have plenty to lose. The upcoming talks may determine whether the relationship gets a reset—or another round of trade brinkmanship.
