What's happened
European officials are preparing new anti-dumping investigations against China amid ongoing frustrations over trade practices, overcapacity, and support for Russia. The EU considers using retaliatory tools like tariffs and export controls, while diplomatic talks with China continue to face obstacles. The situation reflects deepening tensions in EU-China relations.
What's behind the headline?
The EU's increasing frustration with China signals a strategic shift in trade policy. The bloc perceives China's actions—such as weaponising dependencies and supporting Russia—as threats to its economic stability. The discussions around deploying the anti-coercion instrument reveal a move towards more aggressive retaliation, but the complexity of international trade law and the need for unanimity among member states limit immediate action. The EU's balancing act—trying to defend its industries while avoiding escalation—will likely result in a prolonged period of economic tension. The focus on rare earths and steel tariffs indicates targeted measures, but broader systemic reform in China remains the ultimate solution. This evolving stance underscores a broader geopolitical contest, with the EU positioning itself as a more assertive actor in global trade disputes, especially as US-China tensions influence European strategies. The next steps will depend on China's response and the EU's ability to coordinate internal consensus on trade enforcement, which remains uncertain but increasingly urgent.
What the papers say
The South China Morning Post highlights the EU's plans for new anti-dumping investigations and its frustration with China's trade policies, including weaponisation of dependencies and support for Russia. Cecilia Malmstrom describes China as a 'complicated partner' exploiting global dissatisfaction with the US, while EU officials express concern over China's unwillingness to address their grievances. Politico reports on the EU's internal discussions about deploying the anti-coercion instrument and potential tariffs on Chinese steel, emphasizing the deepening trade tensions. It also notes the EU's cautious approach due to legal and diplomatic constraints, with some officials viewing the measures as a 'sticking plaster' rather than a solution. The article also discusses the broader geopolitical context, including US pressure and Trump's tariffs, which complicate EU-China relations. Both sources underscore the EU's strategic shift towards more assertive trade policies amid ongoing tensions, but differ slightly in tone—SCMP focusing on China's actions and EU responses, Politico emphasizing internal debates and legal considerations.
How we got here
EU-China relations have been strained over trade issues, China's support for Russia, and concerns about market distortions caused by Chinese overcapacity. Despite efforts at dialogue, progress has been limited, leading the EU to consider retaliatory measures and the potential use of trade enforcement tools like the anti-coercion instrument.
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