EU gets tough on China as trade imbalance stokes deindustrialisation fears

As European Union trade commissioner Maros Sefcovic hosted Chinese Commerce Minister Wang Wentao in Brussels for talks on Monday, the Slovak diplomat was all smiles. But behind the diplomatic niceties, Sefcovic’s message to China rang out loud and clear. Recommended Stories list of 4 items end of list Addressing the media after a marathon day of negotiations with Wang, Sefcovic may not have literally said “enough is enough,” but he hardly needed to. “China’s exports to the EU keep rising, while our market share in China keeps shrinking,” Sefcovic said. “This trend is not sustainable. The status quo is not an option.” For a long time, Europe was seen as the Transatlantic counterargument to United States President Donald Trump’s protectionism, defending free commerce and trade against a rising populist tide. That now feels like a distant memory. Chinese firms’ rapidly growing footprint in Europe, facilitated by China’s huge subsidisation of industry and huge economies of scale, has rattled European firms and shaken the bloc’s leaders into action. In a speech to the G7 last year, European Commission President Ursula von der Leyen dubbed Chinese industry’s growing dominance overseas a “new China shock”. While there is a variety of views among EU member states about how far the bloc should go to push back against the wave of Chinese goods flooding into the market, there is broad alignment on the need to take action to safeguard domestic industry. …