EU should revive talks on broader China trade deal, top MEP says

The European Union should seek a broad trade agreement with China, potentially including investment, rather than continue negotiating over individual sectors, a senior European Parliament lawmaker said on Wednesday.

Bernd Lange, the German Socialist who chairs the Parliament's Trade Committee, made the call ahead of a visit to Beijing next week by 12 MEPs, as Brussels and China seek to ease mounting trade tensions.

The two sides reached a deal on hybrid cars on 9 October, but the EU views it as insufficient to address a trade imbalance that sees the bloc run a deficit of around €1 billion a day with China.

Brussels and Beijing previously negotiated a Comprehensive Agreement on Investment (CAI), but the European Parliament froze its ratification in 2021 after China imposed retaliatory sanctions in response to EU measures over human rights abuses.

“It is necessary to have a more comprehensive agreement,” Lange told reporters. “I'm also in favour to have an agreement quite soon. Negotiation forever make no sense.”

Lange added that the discussion should include investments. Speaking of the CAI, he also said: “Perhaps it's useful to have a look at that, specifically regarding the investment part.”

Beyond cars, a wider threat to industry

Earlier this month, the European Commission announced a deal under which China agreed to halve its hybrid car exports to the EU over the next four years.

Under the agreement, the EU will introduce country-specific quotas allowing 350,000 Chinese hybrid cars onto the European market annually, with a fixed annual adjustment rate of 6%.

The deal was presented by the Commission as a "first phase" of the negotiation which will continue on a technical level until next political talks scheduled for March 2027.

But French liberal MEP Pascal Canfin, who will join Lange on the trip, warned that the EU needs to look beyond individual industries. He argued that the Commission's negotiations on behalf of the 27 member states should address broader unfair trade practices that threaten European manufacturers across multiple sectors.

“We are open for negotiation, sector per sector, but at the same time, we look at things that it is not a sectorial threat,” Canfin said. “It's the risk of horizontal unfair practices that would have a very detrimental impact on our industries.”

During their visit to China from 27 to 29 October, EU lawmakers will meet representatives of the Chinese Ministry of commerce and members of the National People’s Congress. They are also expected to hold meetings with high-tech business representatives in Hangzhou.

Lange highlighted other issues that should be covered by a future agreement with Beijing, including Chinese export restrictions — Beijing imposes strict licensing requirements on EU businesses seeking to export rare earths, essential to European industry — unfair subsidies in the chemicals and machinery sectors, and a 20% price surcharge on EU bids in public procurement.

The EU is walking a tightrope in its relations with Beijing, pushing for dialogue while simultaneously enforcing trade defence measures to protect its industry.

Last week, EU leaders gave the Commission a political mandate to introduce unilateral quotas to protect the chemicals and machinery sectors, given the urgency of the threats posed by Chinese competition.

However, some member states, such as Spain, favour a softer approach towards Beijing, keen to secure Chinese investment.