ZURICH, November 05 (AJP) -China threatened retaliation Thursday over a proposed European Union trade “kill switch” that would allow the bloc to swiftly restrict imports, escalating tensions with its largest supplier of foreign goods.
The European Commission, which handles trade policy for the EU’s 27 members, is developing the instrument to respond to severe market disruption. It would apply to any country but is widely viewed as targeting China.
Chinese Ambassador to the EU Cai Run said Beijing “opposes politicising economic and trade issues.”
If the EU adopts restrictive or discriminatory measures, China “will have to take countermeasures to firmly safeguard its interests,” he said.
EU trade commissioner Maroš Šefčovič told the European Parliament on Wednesday that the proposal would be presented by year-end. It would give Brussels powers to respond more quickly to harmful trade practices, including by restricting imports.
The proposal would broaden the EU’s ability to defend industries facing pressure across entire sectors. Its existing trade defenses largely rely on investigations into individual products to establish whether imports benefit from unfair subsidies or are sold at unfairly low prices.
France and Germany pushed for faster progress on the new instrument in early October. EU leaders have also sought measures including quotas and tariffs on Chinese chemicals and machinery.
The confrontation reflects a widening trade imbalance that has sharpened European concerns about industrial competitiveness.
The EU imported 559.4 billion euros of goods from China in 2025, up 6.4 percent from a year earlier, according to figures Eurostat published in April. Exports to China fell 6.5 percent to 199.6 billion euros, leaving a goods trade deficit of 359.8 billion euros.
Electrical equipment and machinery accounted for almost half of imports from China, placing sectors central to Europe’s manufacturing economy at the heart of the dispute.
More recent Eurostat figures show the quarterly deficit reached 103 billion euros in the second quarter of 2026, its highest since the third quarter of 2022. Imports from China climbed to 154 billion euros.
Negotiations have continued alongside preparations for tougher trade measures. An October agreement sought to reduce Chinese hybrid-car shipments to the EU, and Šefčovič is scheduled to meet Chinese Commerce Minister Wang Wentao in March 2027.
Cai pointed to progress in the talks and urged both sides to resolve their differences through consultation. His warning nevertheless made clear that Beijing could respond with restrictions of its own if Brussels moved against Chinese interests.
For South Korean carmakers, battery producers and chemical companies competing in Europe, the proposal raises questions about both market opportunities and supply-chain risks.
Restrictions on Chinese competitors could create room for other suppliers, while retaliation could disrupt production networks linking European and Asian manufacturers. The implications will depend on the proposal’s scope and how the EU chooses to use it.
- Tags: European Union, China, European Commission, Maroš Šefčovič, Cai Run, Wang Wentao, Eurostat, trade deficit, tariffs, subsidies, France, Germany, chemicals, machinery
Copyright ⓒ Aju Press All rights reserved.
