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In recent months, the European Union has been more Trumpian on China, renouncing part of its free-trade DNA in favour of increasingly protectionist policies. Just like its role model in Washington, the EU has tried to exact geopolitical and economic concessions from Beijing by escalating to de-escalate – a brinkmanship approach that seems to come straight from US President Donald Trump’s playbook in his trade war against China. But the recent trade detente reached by Trump and Chinese President Xi Jinping in South Korea is likely to change the European direction. At least for the moment. Officially, the EU followed a more assertive path in response to what it views as persistent and unfair Chinese trade practices, as well as what it sees as China’s covert support for Russia’s invasion of Ukraine. Of course, this is not the full story – the Trump administration’s pressure on America’s European allies has also played a decisive role. In the first months of Trump’s second tenure, many saw a window for China and the EU to deepen their collaboration in the face of the US president’s disruptive tariff policies. This, however, did not materialise. Beijing’s refusal to make concessions to Europe, such as by tackling overproduction, eliminating state subsidies to export-oriented industries and stopping support for Russia in Ukraine, pushed the EU back into Trump’s arms. A sort of truce was reached, preventing a trade war between Brussels and Washington – but at the cost of Europeans paying US tariffs, spending more on Nato defence as part of the rearmament of the transatlantic security alliance, and buying more US weapons for Ukraine’s defence against Russia. Nexperia is a case in point of how Trump has influenced the China policy of the EU and its member states. Last month, the Dutch government confirmed it had taken control of the Netherlands-based chipmaker, a subsidiary of Chinese company Wingtech Technology. It said the decision was dictated by economic security concerns, specifically by the need to prevent a shortage of chips in a crisis, and to keep Nexperia’s technology in check. But the move also complies with Washington’s inclusion of Wingtech in a restricted-export list. Also last month, the EU joined the United States – and Britain – in adding sanctions pressure on China and other Asian nations to halt their buying of Russian oil, the proceeds of which the Kremlin uses to fund the Ukraine conflict. After the US and British governments targeted Chinese refiners with penalties, and amid US pressure, the European Commission finally aligned with Washington and London by sanctioning two Chinese refiners and an oil trader. In addition to the Trump-induced anti-China efforts, the European grouping has taken its own steps. EU trade chief Maros Sefcovic recently said the bloc was considering imposing conditions on Chinese businesses intending to invest in Europe, such as the transfer of technology and know-how. The European Commission has also proposed a doubling of the duties on excess shipments of foreign steel in an effort to tackle cheap Chinese imports, which are thought to have contributed to the loss of nearly 100,000 jobs over the past 15 years in the European steel sector. Such measures came on top of last year’s anti-subsidy tariffs on Chinese electric vehicle imports, a sticking point in EU-China relations. The latest trade truce between Beijing and Washington, however, offers the EU the possibility of re-engaging with China in line with its more traditional diplomatic approach. Despite bellicose words from European Commission president Ursula von der Leyen, there remains doubt over the EU’s actual willingness to use its economic security firepower against China. European leaders still tend to prefer dialogue to tariffs or sanctions. At most, the bloc sees these and other trade protection instruments like its anti-coercion “bazooka” as deterrents – in essence a threat to close the EU’s market of 450 million people to Chinese imports. It is not by chance that the Netherlands has maintained an open channel of discussion with China over the future of Nexperia. In the end, the Xi-Trump agreement has laid the groundwork for a negotiated solution, given that the US will now pause the export control rule targeting Chinese entities for a year. Early last month, China’s announcement of new export controls on rare earth minerals, refined products and magnets exacerbated the European malaise over Beijing. The Chinese are major producers and refiners of these minerals, which are essential to manufacturing electronics. With no effective tools to respond with, the EU and the Trump administration tried to mount a campaign of international pressure hinged, it seems, on the narrative that Beijing’s restrictions on rare minerals would endanger the global economy and not only that of the Western camp. Now, after a meeting between EU and Chinese officials in Brussels, Sefcovic has said the suspension of China’s most recent export controls, agreed by Trump and Xi in South Korea, also applies to the bloc. What’s more, signs from China’s proposed five-year plan for 2026-2030 that it could halt subsidies for its EV sector could be conducive to an agreement on EU tariffs. Thus an EU-China reset may well be on the cards. But given the temporary nature of the Xi-Trump truce, China and the US could be at loggerheads within months. In that case, the knives will come out again and one can bet the US president will go back to forcing Europe to be more Trumpian on China.
