Europe Seeks to Counter China’s Trade Influence

The European Union has recently signed a series of free trade agreements with countries including New Zealand, Kenya, and Indonesia, establishing rules for nearly a third of global GDP. These agreements prioritize established trade rules, labor protections, digital information flow, and critical mineral access.

While the US has also pursued trade deals, experts at the Council on Foreign Relations note these often discriminate between partners and lack the stability of treaty-bound systems. However, these European agreements offer limited protection against China’s growing economic dominance.

China’s 2025 net exports exceeded $1 trillion, and its trade surplus with the EU reached a new high last month. This dominance is fueled by widespread subsidies, estimated at 4.4% of GDP by the IMF, that provide Chinese firms with advantages in sectors ranging from high-tech manufacturing to textiles.

Some propose Europe adopt measures like tariffs or export caps to address these imbalances, but analysts suggest that incorporating safeguards against China directly into trade agreements and collaborating with other nations would be a more effective strategy. The future of the global trading system may depend on Europe’s ability to address China’s practices and rally international support.