China has been a financial challenge for Europe for years and now, it could turn into financial disaster – fears that cheap products will be channeled into Europe
As the impact of President Donald Trump’s overthrow of global trade balances are felt on commercial partners, European countries are trapped at the center of the US trade conflict with China.
European countries’ leaders are trying to balance the negotiation and confrontation, with the aim of avoiding side losses, the New York Times said in an analysis.
China has been a financial challenge for Europe for years. Now, it could turn into an economic disaster.
It produces a huge volume of artificial cheap products, high subsidy electric vehicles, widespread electronic consumption, games, commercial quality steel and more and much of them was intended for the US market, known for its huge demand.
However, with many of these products being subject to the duties announced by Donald Trump, fears are rising that they will be channeled to Europe, causing local industries to countries such as France, Germany, Italy, among others, the European Union.
“The problem of overproduction is now concerned with European capitals,” said Liana Fix, a Washington -based external relations associate. “There is a more general tendency and sense in Europe that now it has to defend itself and protect itself.”
European Commission President Ursula von der Laienne, has pledged to “work constructively” with China, while at the same time warning the “indirect consequences” of US duties and said he would closely monitor the imports of Chinese products. A new special team will control the imports for dumping indications.
“We cannot absorb global overproduction nor will we accept dumping in our market,” said von der Laien as Trump’s duties came into force.
The rigorous but measured message to China and the United States has impressed commercially experts, who consider it to be perhaps the only opportunity for Europe to avoid an economic crisis. Janka Oertel, director of the Asia program at the European Foreign Relations Council, described von der Laienne as a “sober” response to the threat from Beijing.
“They continue to keep their place against China because otherwise they lose it,” said Janka Oertel.
However, this critical juncture puts the unity of the European continent.
Spanish Prime Minister Pedro Sanchez traveled to Beijing last week to meet with Chinese President Xi Jing, urging closer cooperation with China as US duties. His initiative, symbolically reflected with a handshake with the Chinese leader, came as Ursula von der Laien and the European Commission leadership continue to demand assurances from Beijing that the dumping will not intensify.
Germany opposed the increase in duties on electric vehicles imposed by the European Union last year, fearing that China will respond by increasing taxation in its own car industry. In Britain, who is no longer a member of the EU, Prime Minister Kir Starmer has called for “consistent, constant and respectful relations” with China as he struggles to stimulate the sluggish British economy.
“The worst scenario is high duties from the US, while at the same time China is flooding the European market,” said Noah Barkin, a senior adviser to Rhodium Group, a political research organization. “This will be a double blow to Europe’s industry. And that’s what Europe is trying to avoid. “
Leaders who argue that closer cooperation with China can be part of the solution, such as Sanchez in Spain and Starmer in Britain, find that this message has a political appeal, at a time when their countries are looking for more foreign investment.
Announcements to create a new Chinese factory that promises to create thousands of jobs are extremely popular inside. However, this desire for investment may in some cases undermine the single and stable European message about trade.
“Spain sees things very different from Poland,” said Theresa Fallon, director of the Center for Russia, Europe and Asia in Brussels. “There is a constant debate in Europe about what its attitude towards China should be.”
However, trade experts point out that the financial relationship of Europe -China is based on decades of reality: the Chinese market remains virtually closed to many European companies, due to regulatory barriers and support of the Communist Party to domestic Chinese companies. EU trade deficit With China it reached 292 billion euros in 2023.
The EU leadership It describes China as a “systemic opponent”, and relations have deteriorated in recent years for many reasons – including Beijing’s support for Russia during the War in Ukraine.
During recent talks with their Chinese counterparts, EU commissioners They were upheld straight warnings.
“Current EU -China trade relations remain unbalanced,” the European Commission said in a statement following the visit of Commissioner Maros Shefkovic to Beijing for talks on market access. The announcement implied that there was tension at the meeting, noting that the commercial deficit was expanding due to “illegal subsidies”.
European officials have been demanding concessions from China for years, such as voluntary restrictions on exports of cheap products and set a few prices to offset the huge state subsidies they consider unfair.
At the same time, Chinese officials are rushing to present Europe as an ever -increasing commercial partner. Beijing’s announcement after Sefkovic’s visit reported little about difficult conversations. On the contrary, he emphasized that the Commissioner described China as a “important partner” and that the two economies would “jointly resist unilateral action and protectionism”.
Following Donald Trump’s announcement on the imposition of new duties on April 2, the Chinese Ministry of Commerce said it has agreed to restart negotiations with the European Union on high European tariffs on Chinese electric vehicles.
When asked about this announcement, European officials expressed a more restrained tone. Olof Gill, EU spokesman On trade issues, he said officials agreed to “continue the discussions” on electric vehicle supply chains and take a “new look” on the price issue.
The pressure on the part of China was at times more obvious. The permanent delegation of China in the EU He has published a series of articles granted on the Euractiv website, an important source of information in the Brussels political circles. The articles focus on how China and Europe can come closer.
For the time being, the EU is avoiding openly showing that it is accepting this approach, mainly seeking to push China to come to an agreement with the United States to prevent the consequences of a possible failure in the US-Chinese negotiations.
An EU-China summit is expected to take place this year, probably in the second half of July.
Source :Skai
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