N. Peter Kramer’s Weekly Column
June will be a crucial month for the relations between the European Union and China. At the G7 summit in France, June 15-17, the leaders of the 7 richest countries in the world will discuss how to defend themselves against China. The country that doesn’t shy away from using its dominance as the main supplier of critical raw materials as an economic weapon. And at the same time with its subsidised overproduction that suffocates entire branches of industry in the western world.
This Chinese trade policy weighs mainly on the industries in the European Union. Industries already facing high energy prices caused by ‘punishing’ Russia, the extreme climate policies of the European Commission, now the war in the Middle-East and not to forget by the EU overregulation and bureaucracy. American competitors are in a much better position to face the competition from China. Also because US President Donald Trump has erected high tariff walls. Something that in particular Germany doesn’t want, contrary to France and Italy.
The input from the G7 discussion will feed into the European summit on June 18-19, where the 27 EU heads of state and government will discuss a more assertive stance towards China. That conversation should lead to concrete measures in the second half of the year. China is already threatening with countermeasures, ‘if the EU adopts new trade instruments and imposes discriminatory restrictions’ , according to the Chinese Ministry of Commerce.
Anyhow, the EU is still a long way from consensus on a new China strategy. Germany, still EU’s largest economy, pleads as usual for caution to protect its export. France, Italy, Spain and some more member states argue for a strict approach. But Spain later distanced itself from this approach. The not so united European Union...
