China’s trade practices threaten Europe’s industry

Beijing China’s trade practices and dominance over critical raw materials are raising concerns across Europe, with growing calls for stronger trade safeguards and diversification of supply chains to protect the continent’s industrial base. A recent report has described China’s state subsidies, alleged currency manipulation and control over essential raw materials as factors contributing to pressure on European manufacturers. It argues that these practices have intensified competition for domestic industries and exposed the risks of excessive dependence on Chinese supplies. According to the report, French and German leaders are calling for sector-wide anti-dumping investigations targeting Chinese electric vehicles, chemicals and machine tools. They are also seeking greater powers to reduce Europe’s dependence on Chinese supply chains. The report points to industrial job cuts in Germany, the closure of domestic assembly lines by European automobile manufacturers and the outsourcing of critical supply chains as signs of mounting pressure on the region’s manufacturing sector. However, it questions whether a proposed European Union rapid-response mechanism would be effective, arguing that the European Commission may struggle to address the structural vulnerabilities behind the problem. It also warns that an aggressive tariff conflict could raise costs for European consumers and manufacturers, while China retains considerable influence through its control of rare earths and semiconductor-grade gases. The debate has renewed attention on the United Kingdom’s efforts to diversify trade and investment ties beyond China. India has emerged as a potential partner in this approach, given the scope for stronger economic cooperation. "German industrial giants are now cutting tens of thousands of jobs, European auto manufacturers are shutting down domestic assembly lines and critical supply chains have been completely outsourced to an authoritarian rival." - Report on China’s trade practices “Even if Brussels manages to push the button, Beijing holds the real levers of power.” - Report on the proposed EU rapid-response mechanism Europe’s efforts to diversify supply chains and deepen trade partnerships with countries such as India could become increasingly important as policymakers seek to reduce strategic dependence on China.