EU ministers vow to tackle 'China Shock 2.0' through talks with Beijing
SPY•EU ministers called for deals with Beijing to curb imports in chemicals, machinery and pharmaceuticals as the bloc’s goods trade deficit with China exceeded €370 billion in 2025 and is on course to surpass €400 billion this year.
1. EU seeks trade talks
EU ministers said the bloc should strike deals with Beijing to curb imports in sectors including chemicals, machinery and pharmaceuticals, citing an “unsustainable” goods trade deficit with China. Irish Foreign Minister Helen McEntee said dialogue could help address imbalances in more industries.
2. Deficit and industry concerns
The EU’s goods trade deficit with China exceeded €370 billion in 2025 and is on course to break well past €400 billion this year, European Commission President Ursula von der Leyen has said. European industry says the surge in exports, dubbed “China Shock 2.0,” is causing factory closures and job losses, including 100,000 positions set to go at Volkswagen.
3. Ministers keep options open
Earlier this month, EU Trade Commissioner Maros Sefcovic agreed with Beijing to cut EU imports of Chinese hybrid vehicles by more than half. Ministers did not detail possible short-term measures alongside talks; Greece’s Haris Theoharis said discussions with China were now producing results, while France’s Nicolas Forissier said dialogue was possible because the EU was speaking as one.
