France, Germany want new EU trade tools against China

Emmanuel Macron, the French President, and Friedrich Merz, the German Chancellor, are set to propose new EU trade measures against China during an upcoming EU summit in Brussels. In a letter to European Commission President Ursula von der Leyen, Macron and Merz called for a legal tool to respond swiftly to potential trade wars with China.

The proposed instrument would enable the EU to cut off access to its single market if necessary, mirroring the damage inflicted upon them by foreign entities. According to a German government source, the EU's trade measures would be less effective against the US and China in a trade war. Germany and France aim to grant the commission the ability to act within days, without the need for approval from the EU's 27 member states.

The new tool could be used against any country, but the primary concern is the EU's trade deficit with China, which totals around €360 billion (around US$400 billion) annually. European companies face price undercutting from Chinese rivals in various sectors, and the EU heavily relies on China for critical raw materials. In addition to the new trade tool, Macron and Merz also desire a method to reduce Europe's dependence on China.