Manfred Weber
Experts, politicians and media are increasingly warning of an impending trade war between the EU and China. The European Commission said in a May 29 press release that while China remains a key partner, “the current state of trade and investment relations with it is unsustainable.”
“Europe needs to open a new chapter in its relations with China,” Manfred Weber, chairman of the European People’s Party in the European Parliament, said in an interview with Bild am Sonntag, as quoted by Euronews.
European Trade Commissioner Maroš Šefčovič confirmed this assessment after a meeting in Paris with his Chinese counterpart, trade emissary Li Chenggang. He told reporters that EU and Chinese authorities intend to deepen the dialog to address the “excessive trade deficit with China.”
Trade deficit of almost €1 billion a day
It jeopardizes Europe’s industrial base. “Either we fight back or China will paralyze certain sectors of our industry,” Weber said. – The EU must deploy the instruments of its trade policy decisively and without hesitation.”
He cited EU duties on Chinese electric cars as an example. Brussels should be prepared to apply them more broadly.
Weber also touched on situations where European aid benefits Chinese companies. In one recent case, EU development funds were used to purchase 380 natural gas buses for Senegal, with a cheaper Chinese bid winning the tender, beating out a European competitor.
Possible costs
However, a tougher trade policy is also fraught with costs. Beijing could respond with restrictions on exports of critical materials such as rare earth metals, posing risks to European industry, especially in Germany.
Existing trade agreements with partners including Canada, the Mercosur countries and India are unlikely to fully offset such shocks.
Weber, however, believes Europe still has serious leverage. “China needs us,” he said, noting that this dependence should be used to ensure fair competition.
