China’s trade grip tightens in Europe as clock ticks towards October deadline

By mid-point in their three-month trade talks with China, European Union nations continue to export more goods to China than they import, despite efforts to rebalance trade ties, according to new data. Beijing's trade surplus with the bloc expanded in July compared to a year earlier in most member states, with some surges being particularly striking, such as Sweden's quadrupling of its surplus and Malta's rising by 166.6 per cent.

China's trade surplus with the EU overall surpassed Germany, Poland, the Netherlands, Spain, and France in July. EU officials, particularly European Central Bank President Christine Lagarde, have expressed concerns over China's influence, stating that the country now competes directly in the value chain of approximately 40 per cent of sectors where Europe holds a comparative advantage, up from around 25 per cent early in the 2000s.

The bloc aims to address these issues with new measures expected from European Commission President Ursula von der Leyen next month, with further discussion planned at a Brussels summit in October. However, some sectors, like electric vehicles, have seen continued growth despite EU anti-subsidy duties. Beijing has not completely ruled out reducing its surplus, but recently blocked attempts to investigate subsidies related to JD.com's acquisition of Ceconomy, illustrating its resistance to EU legislative moves.