The EU's "final negotiations" with China are about to begin, and a trade war is imminent.

First submission 10-06 22:03

Update time 10-07 06:47

EU Trade Commissioner Maros Sefcovic will fly to Beijing from the 8th to the 9th to launch a trade negotiation described as a "final negotiation." Once the negotiation breaks down, a trade war may break out between the EU and China. (Reuters)

[Compiled by Lu Yongshan/Comprehensive Report] In order to reduce the huge trade deficit with China, the EU previously pressured China to come up with specific improvement measures before October, otherwise it will use "all available means." Radio France Internationale (RFI) reported that EU Trade Commissioner Maros Sefcovic will fly to Beijing from the 8th to the 9th to launch a trade negotiation described as a "final negotiation." Once the negotiation breaks down, a trade war may break out between the EU and China.

The report said that Europeans are very clear that if a trade war breaks out, Europe will face a severe situation, so they hope to avoid it through negotiations. However, Europe is also ready to fight back because Europe has to. Europe has never felt the threat from China as it does today. This threat comes from the large influx of cheap Chinese goods into the European continent.

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The surge in Europe's trade deficit with China illustrates the magnitude of the threat from China's "steamroller". Customs data shows that the EU's trade deficit with China further expanded to an average of 1.18 billion euros (NT$42.27 billion) per day in July this year, a surge of 18% from about 1 billion euros (NT$35.82 billion) per day last year. This is a terrifying figure, and Europeans blame it on the Chinese government's massive subsidies to domestic companies and its artificially low RMB exchange rate in order to enhance export competitiveness.

The EU has been working hard to achieve a trade balance with China or at least reduce its trade deficit, but in vain. China's domestic market is weak and residents' consumption power is weak. A large amount of undigested production capacity has poured into Europe. These products not only compete with Europe's automobile, garment, home appliance, tire, chemical and pharmaceutical industries, as well as the future aircraft industry, but this flood of goods, covering so-called "basic" goods and high-tech products, is strangling European industry and commerce, threatening European employment, and thus endangering the European social model.

Now the EU is looking to protect local producers. In the past few months, the European Commission has successively established a series of protectionist barriers, from border carbon taxes to increased steel tariffs, from electric vehicle tariffs to tariffs on small packages from third countries, and even plans to introduce "Europe first" standards in public procurement and the allocation of purchase subsidies. More importantly, the European Commission also stated that it is prepared to use "all available means" if Beijing refuses its request to redefine trade rules.

The Europeans are still holding on to the last glimmer of hope. The negotiations from the 8th to the 9th will focus on reshaping the trade balance between Europe and China. The EU regards this negotiation as the last step in the long negotiations to rebalance the trade relationship between Europe and China.

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