EU's Changing Tune on China Trade
The European Union is planning to toughen its stance on trade with China, marking a significant shift in its approach. This change comes as Germany, the EU's largest economy, is rethinking its long-standing policy of engagement with China.
New Economic Security Doctrine
The EU is set to unveil a new economic security doctrine in December, which will focus on addressing challenges posed by China. These challenges include:
- China's dominance in critical minerals
- Subsidized exports seen as unfair competition for European companies
Germany's Policy Shift
Germany, traditionally cautious about taking a tough stance on China, is now showing signs of a policy shift. Last year, Germany opposed tariffs on Chinese electric vehicles, but recently, it has taken steps to protect its own industries. For instance:
- Set up a committee to advise on security-relevant trade relations with China
- Expressed concerns about Chinese export curbs on rare earths
Growing EU Trade Deficit
The EU's trade deficit with China has been growing, and this is seen as a cause for concern. The EU is looking at various measures to counter unfair trade practices, including:
- Export controls
- Investment screening
- Restrictions on foreign subsidies
Diverging Views Among EU Member States
Not all EU member states are on the same page when it comes to China. While Germany and France are taking a tougher stance, Spain is opening up to Chinese investments. This could potentially undermine the EU's unity on China policy.
Conditions on Chinese Investments
The EU is also looking at setting conditions on Chinese investments in Europe, such as technology transfers. This is seen as a way to level the playing field, as Chinese firms often require technology transfers from European firms.
Conclusion
The EU's approach to China is evolving, with some member states taking a tougher stance while others are more open to engagement. This could have significant implications for EU-China trade relations in the future.
