EU holds summit: Exports to China, energy prices and budget are priorities

Less than a week ago, the European Commission reached an agreement with Beijing to restrict the import of hybrid cars from China. This is the first step in a wider range of measures that the EU hopes to take to reduce the EU's goods trade deficit with China. In 2025, the EU's trade deficit with China has reached 360 billion euros (approximately US$400 billion), and it may still expand further this year.

Drafts from the summit show that EU leaders hope that the European Commission will continue to maintain dialogue with Beijing, while making full use of the EU's existing trade defense measures and adding new trade tools to further protect the EU.

"These imbalances are not limited to a single industry," a senior EU diplomat, who declined to give his nationality, said in a briefing with reporters. "We don't have much time because every month that passes, thousands of jobs are lost."

Growing economic anxiety hangs over the European Union, and far-right parties are exploiting it to make electoral gains.

The deal on hybrid cars is just a first step, but wider imbalances - involving sectors such as chemicals, steel and machinery - remain unresolved. Beijing believes that the EU's hyping up of economic imbalances is actually an excuse to pursue protectionism, put pressure on China and restrict China.

Germany’s stance on imports from China changes

The Franco-German joint proposal released last week is expected to be the focus of discussions at the summit. As the two largest economies in the EU, France and Germany pointed out that there is an urgent need to take measures to deal with the import of chemical products and PET, and called for rapid retaliatory measures against those countries that harm the interests of the EU.

The document marks a major shift in stance for Germany, which just two years ago was the EU's strongest opponent of countervailing duties on Chinese electric vehicles.

The EU summit kicked off with a debate on the EU's competitiveness, with relations with China also being one of the topics. In addition, some EU member states also have high energy prices on their agenda.

The summit will also discuss some of the recommendations previously made by the European Commission, such as delaying the implementation of EU methane emissions regulations for oil and gas imports by one year and asking the EU executive agency to develop further short-term responses.

Another area of ​​disagreement is that countries such as the Czech Republic and Italy want to weaken or suspend the EU Emissions Trading System. This mechanism forces power plants and industrial companies to purchase corresponding emission allowances when emitting carbon dioxide.

The prime ministers of Finland, Sweden and Denmark rejected the proposal from the Czech Republic, Italy and other countries in a letter, praising the system as a driving force for energy security and helping Europe reduce its dependence on imported fossil fuels. They warned that any move to "weaken" the system would discourage investment in clean industries.

EU leaders will also discuss the EU's budget for the next seven years, from 2028 to 2034. The budget requires unanimous approval by member states, which often leads to intense negotiating differences between net contributors and net beneficiaries. The EU plans to hold a special summit in late November to try to reach a consensus on this.

One of the main topics on Friday will be the challenges facing Ukraine, with Ukrainian President Volodymyr Zelensky expected to attend. EU leaders are likely to discuss Ukraine's funding needs in 2027. Additionally, they may express regret over the U.S. decision to temporarily lift sanctions on Russian diesel.

Dutch Prime Minister Rob Jetten said in an interview with reporters: "I call on all European leaders to increase their support in the financial, military and non-military fields, because many European countries are not doing enough to support Ukraine."

"Let's step up and make sure they win this pointless war."