Tensions Rise as Xi Jinping Urges EU to Handle Trade Differences

Strategic Insights -

Chinese President Xi Jinping stressed the importance of cooperative relations with the European Union on Thursday, urging the EU to "properly handle differences and frictions" during a tense summit in Beijing. The meeting comes amid escalating trade tension and concerns over the Ukraine war. Xi emphasized that the current challenges facing Europe do not come from China, and called for open cooperation, citing the need to avoid "building walls and fortresses". In response, European Commission President Ursula von der Leyen and European Council President Antonio Costa expressed concerns over trade imbalances and the EU's trade deficit with China, which reached a historic 305.8 billion euros ($360 billion) last year.

Key Takeaways:

  • Xi Jinping urged the EU to properly handle differences and frictions, emphasizing the need for open cooperation and avoiding protectionist measures.
  • The EU's trade deficit with China reached a historic 305.8 billion euros ($360 billion) last year, sparking concerns over trade imbalances.
  • European Commission President Ursula von der Leyen called for a rebalancing of trade ties with China, citing the need for real solutions to address the trade deficit.
  • China's exports of rare earth magnets to the EU surged in June, although overall exports were still 35% lower than the previous year.
  • The EU is set to seal a trade deal with the United States, avoiding a harsher 30% tariff threat.

Statistics:

  • EU trade deficit with China: 305.8 billion euros ($360 billion)
  • EU's rare earth export controls: exported 1,364 metric tons of rare earth magnets in June, up 245% from May
  • EU-China trade tensions: EU has imposed trade actions on Chinese exports of EVs and other goods
  • US-China trade deal: EU and US to seal a 15% tariff deal, avoiding a threat of 30% tariff

Sources:

  • Xinhua (Chinese state news agency)
  • Pool report from the meeting between Xi Jinping and EU officials
  • Cui Hongjian, foreign policy professor at Beijing Foreign Studies University
  • European Union officials (referenced as Ursula von der Leyen and European Council President Antonio Costa)
  • Customs data on rare earth exports