China forces reckoning in Europe as trade turns existential

French president Emmanuel Macron has branded the trade imbalance with China “unbearable,” saying what’s at stake now is “a question of life or death for European industry.”

- Bloomberg

Value of China's exports to EU now more than double its imports, as Chinese sellers divert goods facing levies in the US.

(BLOOMBERG)

European Commission President Ursula von der Leyen believes the bloc’s ties with China “have reached an inflection point.”The scale of the imbalances with the European Union (EU) was thrown into stark relief days ago when Beijing disclosed its trade surplus with the bloc had widened to a record approaching $300 billion in 2025. The value of China’s exports to the EU is now more than double its imports, as Chinese sellers divert goods facing levies in the US.

“The China shock in Europe is really starting to hit,” said Andrew Small, director of the Asia program at the European Council on Foreign Relations. “What you've now had in recent months has been much greater levels of urgency, not all of it playing out in public, but serious crisis meetings taking place.”

The result could be the biggest rethink of EU policy toward Beijing in at least a decade, according to Small, who previously advised von der Leyen on China. Sidetracked for years by the war in Ukraine and, more recently, by Donald Trump’s tariffs, the EU is finally focusing on China, preparing what Small describes as a “pent-up” mix of measures.

The bloc unveiled a plan earlier this month to ensure its industries aren’t overtaken by global rivals, as competition intensifies with the US and China. The European Commission, the EU’s executive arm, has also proposed setting up an economic security hub to better navigate trade tensions and counter the threat of cheap products flooding the bloc’s single market.