Joachim Nagel describes China as both partner and competitor to Europe

Joachim Nagel, President of the Bundesbank and member of the European Central Bank Governing Council, characterized China as one of Europe’s most significant yet complex economic partners. In a speech on October 17, Nagel noted that while China remains a vital source of imports and a major market for European exports, its growing industrial capacity presents a competitive challenge and a potential strategic vulnerability regarding essential goods.

Nagel emphasized that Europe does not follow a single strategy for Asia. Instead, the European Union is diversifying its trade ties through rule-based relationships with Japan, South Korea, Singapore, and Vietnam, while also increasing engagement with India due to its market size and economic expansion. This cooperation extends beyond trade to include research, development, and shared manufacturing.

To maintain sovereignty and competitiveness, Nagel argued that Europe must build more resilient and diversified relations with China while integrating more deeply with a broader range of Asian partners. He cited the specialized partnership between the Dutch lithography firm ASML and TSMC as a model for how highly specialized companies in Europe and Asia can create mutual benefits within global value chains.