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Europe’s Trade Tensions With China Are Coming to a Head
Confirmed
In Short: The company Shein, backed by a vast network of factories in China, is navigating a different landscape due to trade tensions and regulatory concerns, as reported by BBC (United Kingdom).
EU trade commissioner Maros Sefcovic arrived in Beijing on Thursday for talks aimed at averting a trade war with China, following a billion-euro daily trade deficit last year, according to AFP and Arabnews (Saudi Arabia).
The EU's trade deficit with China, attributed to what many in the bloc see as Beijing's unfair trade practices, has reached alarming levels, with the bloc losing around a billion euros ($1.1 billion) daily, as reported by AFP and Arabnews (Saudi Arabia).
Ahead of Sefcovic’s trip, Bernd Lange, the EU parliament’s trade committee chief, noted that China's current economic crisis gives the EU significant bargaining power, as stated by Arabnews (Saudi Arabia) and AFP.
The EU and China have been negotiating since June, with Sefcovic expressing hope for tangible results by October. However, China's commerce ministry issued a statement, emphasizing the importance of openness, cooperation, and free trade, as noted by AFP and Arabnews (Saudi Arabia).
Market observers expect the trade dispute between the EU and China to become structurally entrenched and protracted, as reported by NetNewsLedger and Thediplomat.
The EU's reliance on China for rare earths, permanent magnets, and critical minerals, which are essential for Europe's green, digital, and defense industries, complicates the negotiations. According to Thediplomat, 98 percent of EU demand for rare earth magnets is met by Chinese imports.
The proposed EU weapon to counter trade aggression would give the European Commission the power to respond to a trade attack within days, as discussed at an upcoming EU leaders' summit.
The EU's toolbox to counter unfair subsidies, dumping, discriminatory procurement, and economic coercion must be applied consistently and enhanced where necessary, according to Lange, as stated by AFP and Arabnews (Saudi Arabia).
The EU's trade committee chief, Bernd Lange, suggested that an export-restraint agreement with China could be tested in a specific sector, as reported by AFP and Arabnews (Saudi Arabia).
The company was once estimated to be worth nearly $100bn but has faced heated competition, trade tensions, and questions over the ethics of its supply chain, as noted by BBC (United Kingdom).
The BRICS group has unanimously adopted a joint declaration, calling for calm in the Middle East and stressing the need to work together to maintain the smooth flow of global trade, supply chains, and energy, as reported by Al Jazeera (Qatar).
India is leveraging the BRICS summit to position the grouping as a complementary engine for economic growth while championing the Global South’s core developmental priorities, as reported by Siasat.
What's confirmed
- The EU last year ran a trade deficit of around a billion euros ($1.1 billion) a day with China, caused by what many in the bloc see as Beijing's unfair trade practices.
- "We hope that France and Germany, as major economies in the world, will uphold openness, cooperation and free trade," the commerce ministry said in a statement.
- According to a letter seen by AFP on Monday, President Emmanuel Macron and Chancellor Friedrich Merz have urged the EU to ready a "credible instrument" to respond quickly to any escalation by Beijing, although China was not mentioned explicitly.
- "They should avoid going down the wrong path in the wrong way, only to ultimately suffer the consequences themselves."
- EU and Chinese officials have been negotiating since June, and Sefcovic raised hopes earlier this year when he said that he wanted "tangible results by October".
- "The EU has a well-supplied toolbox to counter unfair subsidies, dumping, discriminatory procurement, and economic coercion. These instruments must be applied consistently and, where necessary, enhanced," Lange said in a statement.
- China immediately fired a warning shot after the letter, urging Paris and Berlin on Tuesday to steer clear of "protectionist" measures.
- The two days of discussions by EU trade commissioner Maros Sefcovic in Beijing come just as France and Germany, the bloc's two biggest powers, threaten to up the ante.
- "But if one sector could be identified in which an export-restraint agreement with China could be tested, that would be a good step," Ignacio Garcia Bercero from Brussels think-tank Bruegel told AFP.
- The proposed weapon -- to be discussed at an EU leaders' summit next week -- would give the European Commission the power to respond to a trade aggression within days.
- The European Union's top commerce official was due in China on Thursday for talks aimed at bringing both sides back from the brink of a mutually damaging trade war.
- But Europe can ill afford to anger China in case it throttles supplies of rare earth minerals that are vital for the continent's industrial sector.
What's still developing
- Those commitments make the issue directly relevant to Canada as well as Europe.
- Fox News chief foreign correspondent Trey Yingst reports from Tel Aviv and on escalating tensions as the U.S.
- Trump is seeking tangible economic gains, from agricultural purchases to aircraft orders, consistent with his long-standing focus on reducing the U.S. trade deficit and addressing structural imbalances that have weakened American manufacturing.
- Its main concrete outcome was modest: a two-month extension, until January 2027, of the trade truce first agreed after the Trump-Xi meeting in Busan a year ago, when Washington lowered tariffs and Beijing suspended export controls on rare earths and other critical minerals.
- Shein is backed by a vast network of factories in China Trade tensions and regulatory concerns mean Shein is navigating a very different landscape to when it first started exploring a potential IPO.
- However, rising geopolitical tensions between the US and Iran, coupled with a resilient US labor market, keep Federal Reserve (Fed) tightening expectations elevated and could weigh on BTC.
- But that push is being complicated by trade tensions with close allies, making incremental progress on steel more likely than an early breakthrough, added the people, who were granted anonymity, to describe the closed-door discussions.
- “These countries can still hold each other’s hands when it comes to the basics: recognition that there is a common challenge in the excess capacity coming from China,” said one person with knowledge of the preparations.
- BRUSSELS — The Trump administration is quietly pushing to create a coalition of mostly Western allies to counter China’s massive steel overproduction, even as it wages a full-scale trade war with Canada and tensions with the EU persist.
- While the ECB is poised for a modest rate hike, the dollar’s safe-haven appeal amid geopolitical tensions and terms-of-trade challenges for Europe are weighing on the euro.
- Beyond interest rate expectations, the euro is facing structural headwinds related to Europe’s reliance on energy imports.
- US President Donald Trump gave Chinese President Xi Jinping a high-profile welcome at the airport on Wednesday as Beijing and Washington sought to ease tensions between the world's two largest economies.