EU and China Launch Urgent Trade Talks Amid Economic Pressures

UPDATE: European Union leaders are in Beijing today, July 13, 2023, for urgent trade talks aimed at addressing a significant $400 billion trade imbalance with China. The summit, originally planned for two days, has been scaled back to just one amid rising global tensions and economic uncertainty.

European Commission President Ursula von der Leyen and European Council President António Costa are meeting with Chinese President Xi Jinping and Premier Li Qiang, marking 50 years of diplomatic relations. However, expectations for any major agreements are low, as both sides face pressing challenges, including ongoing conflicts in the Middle East and Ukraine, and the possibility of renewed tariffs from the United States.

Officials are expected to raise critical issues, including China’s support for Russia in its full-scale invasion of Ukraine, persistent cyberattacks, and human rights violations in Xinjiang, Tibet, and Hong Kong. The EU is also wary of balancing its relationship with Washington, especially as it braces for potential trade hostilities.

Fabian Zuleeg, chief economist of the European Policy Centre, stated, “Europe is being very careful not to antagonize President Trump further by appearing too close to China, complicating the summit’s efforts.” He added that achieving concrete outcomes will be challenging given China’s hardening stance.

Despite some gestures of goodwill—such as the suspension of sanctions on European lawmakers criticizing China’s human rights abuses—there is little indication that China is willing to make significant concessions. Zuleeg noted, “China has come away emboldened from its trade confrontation with Trump, reducing its appetite for compromises with the EU.”

China remains the EU’s second-largest trading partner, with about 30% of global trade flowing between them. While both sides recognize the value of their economic ties in stabilizing the global economy, deep-rooted divisions persist.

As the summit progresses, the world watches closely for any developments that could reshape international trade dynamics. The outcome of today’s discussions could have lasting implications for EU-China relations and the broader global economy.

Stay tuned for updates as this story develops.