On Monday, May 6, the President of the European Commission, Ursula von der Leyen, met with French President Macron and Chinese Communist Party leader Xi Jinping in Paris. After the meeting, von der Leyen stated that if China fails to provide fair market access to European companies, the EU is prepared to use all available trade tools to defend its economy.
The discussions in Paris centered around the economic and trade relationship between Europe and China. Von der Leyen emphasized the importance of fair competition for a prosperous and sustainable economy in Europe, leading to more quality job opportunities. She highlighted the ongoing serious issue of economic and trade imbalances, expressing deep concern over the matter.
“We have made it clear that we will defend our companies and our economy. If necessary, we will not hesitate to do so,” von der Leyen said.
Regarding China’s subsidies on products such as electric cars and steel flooding the European market, von der Leyen urged Chinese authorities to address the issue of structural overcapacity. Despite China’s strong support for manufacturing, domestic demand in China has not increased, leading to a situation where the world cannot absorb the excess production from China.
“We will closely coordinate with G7 countries and emerging economies, which are also increasingly affected by China’s distorted market behaviors,” she added.
The issue of fair trade was also discussed during the Paris meeting. The EU leader stressed that mutual market access is essential for fair trade between nations.
“We discussed how to make real progress in terms of market access. While I believe there is still room for more progress, we are prepared to fully utilize our trade defense tools when necessary,” von der Leyen stated.
She referenced a recent EU investigation into China’s public procurement practices for medical equipment based on international procurement tools. If the investigation reveals unfair treatment of European companies, it could lead to restrictions on Chinese medical device companies participating in EU public tenders, ranging from reduced bidding scores to complete exclusion.
“Europe cannot accept market-distorting practices that could lead to deindustrialization in Europe,” von der Leyen emphasized.
In addition to urging China to change its unfair practices, von der Leyen highlighted the need for Europe to enhance the flexibility of its supply chains. Diversifying key raw material sources to reduce overreliance on China was cited as a solution. The EU has reached multiple agreements to expand the number of countries from which it obtains essential raw materials.
“This is effectively about risk mitigation. While our market remains open to fair competition and investment, if it compromises our security and makes us vulnerable, it is not in Europe’s interest. This is why we are taking action,” von der Leyen explained.
The EU leader underscored the complexity of the EU-China relationship, emphasizing the need to approach it with clarity, constructiveness, and responsibility. Meanwhile, Europe will make difficult decisions without hesitation to protect its economy and security.