EU officials cite China’s manufacturing overcapacity and falling exports as key drivers of the bloc’s growing trade imbalance.
The EU’s trade deficit with China has expanded significantly, driven by a tenfold increase in auto imports from China since 2019. EU vehicle exports to China have declined sharply during the same period, exacerbating the imbalance.
Officials attribute the deficit to China’s manufacturing overcapacity, which has prompted the European Commission to explore new trade measures. A debate scheduled for late May may address potential actions to counter perceived overcapacity in Chinese sectors.
Analysts expect China to adopt a restrained approach toward the EU, aiming to preserve trade ties while avoiding escalation. The strategy seeks to maintain engagement with the EU as a counterbalance to U.S. tensions.