EU hints at measured approach to China, offering to rebalance trade relations

This article is part of our special report 50 Years of EU-China Relations: the future of the strategic partnership.

Maroš Šefčovič’s high-stakes visit to China at the end of March hinted at a more measured, strategic recalibration in the bloc’s approach to Beijing.

The European Commissioner for Trade and Economic Security visited the Chinese capital on 27-28 March, just a few days after pit-stopping in Washington to meet with his American counterparts.

It was the Trade Commissioner’s second trip to the US since Donald Trump took office in January, to try to convince the Americans of the mutual challenges and business benefits to be gained on both sides of the Atlantic by avoiding or muting tariffs.

‘Levelling the playing field’

In Beijing, Šefčovič met with a delegation composed of Vice Premier He Lifeng, Commerce Minister Wang Wentao, and Customs Minister Sun Meijung. Talks focused on improving and rebalancing EU-China trade and investment relations.

Šefčovič and Wang agreed to maintain regular contact to ensure progress on key market access concerns and trade policies and also committed to a dialogue on the electric vehicle supply chain to enhance European competitiveness.

Meanwhile, Šefčovič and Sun decided to establish a working group on agri-food market access and explore revisions to the 2024 EU-China Customs Cooperation and Mutual Assistance Agreement.

Developing healthy relations

Vice Premier He stated China is willing to work with the EU to enhance dialogue and exchanges, properly handle trade and economic differences, and promote a “healthy and stable” development of economic and trade relations.

He also emphasised the need to jointly resist unilateralism and protectionism while safeguarding the multilateral trade system, all in the context of the 50th anniversary of diplomatic relations between China and the EU.

In the readout published by the Chinese Ministry of Commerce, Šefčovič noted that China is an important partner for the EU and expressed agreement that differences should be resolved through dialogue and consultation.

Solving trade concerns

While China remains a crucial trading partner for the EU, the trade balance is skewed, with a growing deficit in goods trade due to illegal subsidies. The sides do not see eye to eye on electric vehicles and dairy products.

In 2024, the EU-China trade deficit reached €304.5 billion, while Chinese foreign direct investment in the EU hit a five-year high of €185 billion, nearly matching EU investments in China.

Despite the need for the EU to steer its ship in clear waters and away from the hurricane blowing through Washington, a white flag with China seems unlikely. However, a pragmatic relationship offers reasonable advantages.

The EU, however, might want to solve its woes sooner rather than later and decide once and for all if China is its systemic rival or strategic partner. Across the pond, Donald Trump is playing a high-risk, high-reward game.

[Edited By Brian Maguire | Euractiv's Advocacy Lab ]