EU's fragmented China policy limits strategic cooperation

During the European Council summit in Brussels on 18‑19 June, EU leaders discussed the bloc’s budget, Ukraine, the Middle East and “global macro‑economic imbalances,” a phrase that referred to the growing strain in EU‑China relations. The summit produced a dual‑track approach: it urged continued dialogue with Beijing while calling for an evaluation of the EU’s trade‑defence toolbox and new regulatory measures.

The EU has already imposed countervailing duties of 17‑35% on Chinese battery electric vehicles and maintains high tariffs on Chinese ceramics and an investigation into tire imports. China has responded with anti‑dumping duties on EU pork, dairy and brandy. The European Commission’s proposed Industrial Accelerator Act and revisions to the Cybersecurity Act aim to protect strategic sectors, affecting Chinese firms such as Huawei. Beijing, in turn, maintains its own protective legislation, export controls on rare‑earths and other critical minerals, and a legal framework to block foreign investigations.

Analysts describe this situation as a “China shock 2.0,” where China’s influence now extends beyond cheap consumer goods to high‑tech industries – electric vehicles, batteries, solar panels, robotics, semiconductors, AI, biotech and critical minerals. The EU’s current policy, built on viewing China mainly as a market, is seen as outdated and insufficient for the strategic challenges posed by China’s expanding system‑wide economic power.