France and Germany have called on the European Commission to obtain new powers to protect the European market from economic distortions and growing pressure from China.
In a letter to European Commission President Ursula von der Leyen, French President Emmanuel Macron and German Chancellor Friedrich Merz proposed restricting access to the EU market, diversifying supply chains and preparing for possible retaliatory measures by third countries.
Paris and Berlin warned that European industry is facing a “massive industrial shock,” particularly in sectors such as automobiles, pharmaceuticals, machinery, aerospace and chemicals.
The EU considers its economic relationship with China increasingly imbalanced. European Commission President Ursula von der Leyen said in September that the bloc’s trade deficit with China had reached €1 billion a day, calling the situation unsustainable.
The proposal also calls for stronger measures against subsidies, currency manipulation and practices that undermine European competitiveness. France and Germany are seeking faster and broader use of EU trade-defense instruments, as well as new mechanisms to respond to unfair competition and reduce dependence on single sources for critical supplies.
France and Germany also want the EU to be prepared for countermeasures in the event of an escalation in the trade dispute with China. Beijing has previously warned that it would respond firmly to EU restrictions targeting Chinese companies or products.
