Brussels and Beijing are heading toward a trade confrontation in the coming months, but the concessions Europe can actually extract from China will depend on several factors – chief among them how much economic pain the EU is willing to endure.
The EU-China trade deficit has grown exponentially in recent years, reaching a record €1 billion a day in 2025, prompting European leaders to demand a rebalancing of what they call "unsustainable" economic relations with Beijing.
Tensions have escalated in recent months as the EU makes moves to protect its market, targeting Chinese companies over illegal products, public subsidies and foreign direct investment – and drawing threats of retaliation from Beijing in the process.
European Commissioner for Trade Maroš Šefčovič met his Chinese counterpart, Wang Wentao, in Brussels on 29 June in an effort to defuse tensions. The two sides issued a joint statement calling for "stabilising" the relationship and making it "more balanced."
After the meeting, Šefčovič set an October deadline for "tangible" results through further dialogue, and EU leaders are due to gather in Brussels that same month to discuss macroeconomic imbalances.
