China warns EU not to ‘fantasise’ on trade approach as Brussels confirms new ‘kill switch’

Beijing has cautioned Brussels against the notion that adopting a tough stance on trade will force China to make concessions. The EU has announced plans for a robust "kill switch" that could immediately exclude China from the single market. This development follows a recent agreement to limit the flow of hybrid cars from China to Europe.

The announcement came a week after the two sides reached a surprise deal, suggesting that the possibility of a trade conflict between the world's two largest economies remains high. The Ministry of Commerce of China stated that the EU should not rely on pressure to gain benefits and must respect China's determination to protect its interests.

This response followed reports that Brussels believed the pressure from Europe had led Beijing to agree to the deal. The new instrument aims to counter Chinese coercion and economic imbalances, complementing intensified dialogue with Beijing. European Commission President Ursula von der Leyen confirmed the development of the new weapon, which will restrict access to the single market where it serves the interests of the union.

The proposal gained unanimous support from the EU's 27 leaders during the European Council summit in Brussels. German Chancellor Friedrich Merz, who previously advocated for a free-trade agreement with China, now supports the "kill switch" idea, driven by the consensus among EU members. French President Emmanuel Macron suggested targeting chemicals and plastics as priority sectors, while German officials confirmed that there would be no retreat from the policy.

The instrument would require support from at least 13 member states to be activated, but ensuring its compliance with World Trade Organization rules is considered challenging.