European Union leaders will discuss trade measures against China’s impact on the European industry due to the massive influx of cheap goods from China. At the same time, internal EU documents obtained by Reuters show that the EU is seeking to acquire more key minerals from Vietnam to reduce reliance on China, with Vietnamese President To Lam expected to visit Europe next week.
The surge in imports of Chinese automobiles and other goods is putting pressure on the European manufacturing sector. The export restrictions on key minerals by Beijing in 2025 had disrupted the European supply chain. Consequently, the EU is considering trade measures and searching for alternative sources of raw materials.
The EU and Beijing had previously outlined an agreement aimed at curbing the surge in imports of hybrid cars. On Thursday, EU leaders will discuss whether to base further negotiations with Beijing on this agreement or consider stricter restrictive measures.
Germany and France have proposed reducing the trade deficit with China. The EU’s trade deficit with China reached €360 billion (around $402 billion) in 2025 and had already reached €200 billion in the first half of 2026.
Ursula von der Leyen, President of the European Commission, stated that such a significant deficit is “unsustainable” and emphasized using all available methods to reduce it.
The EU’s policy focus has shifted from improving European companies’ access to the Chinese market to efforts to reduce imports of Chinese goods. The EU’s trade deficit with China spans various industries such as machinery, textiles, basic metals, chemicals, and automobiles.
Germany’s stance has also shifted. While two years ago Germany opposed imposing tariffs on Chinese-made electric vehicles, it has now joined France in making such a proposal. According to Deutsche Welle, German Chancellor Merkel and French President Macron jointly wrote to von der Leyen last week.
Sander Tordoir, Chief Economist at the European Reform Centre, remarked that the alignment of the two most significant EU member states on how to address the “second China shock” is of great significance in itself.
The joint document presented by France and Germany last week highlighted the urgent need for the EU to address the import issues concerning chemicals and PET plastics.
The document also advocates for reducing companies’ reliance on a single key source of raw materials and promptly counteracting any country that harms EU interests. Even if this week’s summit decides to continue dialogues with Beijing, the European Commission may propose the first related measures in December.
In addition to considering restrictions on Chinese imports, the EU is also seeking to lessen its reliance on key minerals from China. With its abundant mineral resources, Vietnam has become a potential partner for deepening cooperation with the EU.
Reuters obtained reports and attachments written by the EU delegation in Hanoi in June 2026. The documents indicate that Beijing’s export restrictions last year “disrupted the European supply chain,” prompting the EU to seek “an alternative source outside of China.” Reuters notes that these two documents had not been reported on previously.
The documents emphasize, “Given Europe’s urgent need to rearm quickly and reduce risks, and with Vietnam having rich reserves of key raw materials, especially rare earths and tungsten, the EU must not overlook Vietnam as a potential key supplier of raw materials.”
Vietnam possesses resources such as rare earths, tungsten, antimony, bismuth, and bauxite. Gallium can be extracted from bauxite as a byproduct.
Vietnam is not currently among the EU’s 16 strategic partners for raw materials. The key minerals that Vietnam exports to the EU are primarily tungsten and antimony, both used in defense industries, including ammunition and explosives manufacturing. The document recommends providing financial support to maintain and expand pipelines for obtaining tungsten, bismuth, antimony, and titanium.
Four European and Vietnamese officials have informed Reuters that President To Lam is expected to meet with EU leaders on October 22. Two officials further noted that key minerals are expected to be a significant topic of discussion, although the visit has not been officially announced.
The European Commission stated that it is assessing the potential for concrete cooperation with Vietnam. EU documents propose methods such as loans, grants, technical assistance, and export credit insurance to support Vietnam’s mineral processing and resource surveying.