Overview
- The European Union ran a roughly €360 billion goods deficit with China in 2025, a sharp rise that has put Germany under particular strain with a bilateral shortfall near €90 billion.
- EU leaders have instructed the European Commission to design faster, sector-specific trade-defence measures that would let Brussels act more quickly than slow anti-dumping and anti-subsidy probes.
- Some officials, including France’s president, have called for a power like the U.S. Section 301 to impose tariffs or quotas, though legal drafting and political agreement across member states are likely to take months.
- Chancellor Friedrich Merz pressed Beijing during a February visit for commitments to buy more high-quality German goods and has also proposed coordinated action on currency valuation as part of Germany’s response.
- German automakers and other export-dependent firms warn that tougher measures risk Chinese countermeasures and disrupted supply chains, a trade-off that is shaping EU leaders’ careful diplomatic engagement with China.