China threatens the EU with a decisive response to trade restrictions

China has threatened the European Union with a “firm response” to protect its industries if trade restrictions are imposed. The background is a media report according to which Germany and France are pushing for a new instrument against unfair trade in order to take action against China on the EU market. The Chinese Ministry of Commerce said the plan is a “typical protectionist and unilateral measure” and will disrupt the stability of trade between China and the EU.

According to its own information, the authority responded to an unspecified media report. Accordingly, EU member states should work on a joint document to call on the EU Commission to more quickly formulate a trade instrument similar to the US model of Paragraph 301. Through Section 301, which is enshrined in the US Trade Code, the US government can take action in cases of demonstrably “unjustified, unreasonable or discriminatory” trade practices.

State newspaper refers to analyst report

The Chinese state newspaper Global Times referred to a blog post by EU-China relations analyst Noah Barkin. In the article published on Sunday, Barkin, citing EU officials, wrote that Germany and France were finalizing a joint paper calling on the Commission to speed up the development of a tool that would give Brussels new powers to exclude China from the EU market.

If the EU pushes forward protectionist measures against China, the People's Republic will respond with a "strong policy toolbox," the Global Times quoted an unnamed "Chinese observer." Possible countermeasures could therefore include investigations into discrimination, the security of supply chains or the influence of foreign subsidies.

The Ministry of Commerce further warned of damage to trust and disruption to ongoing consultations between the EU and China. The two sides have been holding trade and investment consultations since June.