China Warns EU of Retaliation Over Planned Trade Restrictions
China has issued a formal warning that it will retaliate if the European Union expands trade restrictions against Chinese goods, as Brussels signals a major shift toward broader, sector-wide trade defence measures that could reshape transcontinental supply chains.
The Chinese Ministry of Foreign Affairs accused the EU of “selectively using” data to justify claims of unbalanced trade relations and warned that Beijing would take “all necessary measures” to protect its legitimate rights and interests. “The EU is not obliged to trade with China,” a spokesperson said on Thursday, as reported by Het Laatste Nieuws.
Context
The warning comes as Stéphane Séjourné, the European Commission Executive Vice-President for Prosperity and Industrial Strategy, told the Financial Times that the EU intends to broaden import quotas and tariffs across entire industrial sectors—not just individual products. Séjourné described the threat from Chinese imports as “existential” for European manufacturers in chemicals, metals and clean technology, sectors where state-subsidised overcapacity has long driven down prices and squeezed European producers, according to trans.info.
The EU’s goods trade deficit with China reached €359.9 billion in 2025, up 2.7% year-on-year. EU exports to China fell by 6.5% to €199.5 billion, while imports from China rose by 6.4% to €559.5 billion, according to the European Commission’s Directorate-General for Trade. In volume terms, the deficit grew from 44.8 million tonnes in 2024 to 58.1 million tonnes in 2025, making the issue directly relevant to port capacity and logistics infrastructure across Europe.
Key Developments
Séjourné warned that 29 million jobs are at stake across the chemical, metal and clean technology sectors, which risk being destroyed by unfair Chinese competition, as reported by ANP/RTR via ZeelandNet. The Commission’s planned expansion of trade defence measures marks a significant departure from the EU’s traditional product-by-product approach to anti-dumping and anti-subsidy investigations.
The clearest template for this new approach is steel. In April 2026, the EU reached a provisional agreement on a new steel import system, cutting annual tariff-free steel import quotas to 18.3 million tonnes—47% below 2024 levels—and raising out-of-quota duties to 50%, as reported by EU Today.
Five EU member states—France, Italy, Spain, the Netherlands and Lithuania—have circulated a joint policy paper urging Brussels to strengthen and speed up trade defence tools. Germany, with its major export exposure to China, did not sign the document, highlighting internal divisions within the bloc.
German Economics Minister Katherina Reiche visited China from May 27 to 29, advocating for strengthening bilateral relations while also warning about trade imbalances. “In times of global uncertainty, we need dialogue, trust and robust partnerships,” Reiche said ahead of her visit, as France24/AFP reported. She urged the EU to ensure any trade measures do not harm European exports to China.
Chinese state media has also weighed in. The Global Times, in an editorial on May 26, warned that “the EU cannot afford a so-called ‘trade war with China’” and that “any unilateral measures that harm the legitimate interests of Chinese enterprises will inevitably face strong countermeasures from China,” as reported by the Global Times.
Analysis & Implications
The escalating EU-China trade tensions are unfolding against a backdrop of multiple simultaneous trade disputes. The EU is simultaneously navigating trade tensions with the United States, where President Donald Trump has threatened 25% auto tariffs and set a July 4 deadline for the EU to implement its part of the Turnberry trade deal signed in July 2025.
China argues that the trade deficit narrative is misleading. Nearly half of EU-China trade consists of intermediate goods that European companies process for global sale, and the EU maintains a services trade surplus with China of €21.3 billion. Beijing also points to EU restrictions on high-tech exports—such as lithography machines—as limiting China’s ability to reduce the deficit.
The EU officially characterizes its approach as “de-risking” rather than “decoupling”—reducing critical dependencies while keeping trade links open. However, the shift from targeted anti-dumping measures to sector-wide safeguards blurs this distinction and could mark a more confrontational phase in EU-China economic relations.
For Belgium, as a major EU trading hub with the Port of Antwerp and significant export-oriented industries, the stakes are particularly high. Belgian businesses that rely on Chinese imports or export to China could face disruption, while consumers may experience price increases if tariffs raise costs. The Belgian sugar sector has already received EU protection against cheap imports, signalling the potential for broader protective measures.
What’s Next
The European Commission is expected to debate China trade measures in late May, with EU leaders meeting in Brussels in June to discuss a joint approach. A European Parliament vote on the EU-US trade deal is expected in mid-June, ahead of Trump’s July 4 deadline.
Meanwhile, the EU is due to introduce a flat €3 customs duty on low-value online parcels from Chinese platforms like Shein, Temu and AliExpress on July 1, 2026, adding another layer to the evolving trade landscape.
Whether Séjourné’s remarks translate into formal Commission proposals or remain a political signal will become clear in the coming weeks. What is already evident is that the EU’s China policy is moving beyond diplomacy and market access, towards a more defensive model of industrial protection—with consequences that will be felt from Beijing to Brussels and beyond.