Šefčovič: EU–China Trade Deficit Is “Unsustainable” — Beijing Agrees First Rebalancing Steps

EU–China Trade Talks

Maroš Šefčovič said the EU’s trade deficit with China is unsustainable. He said trade relations need to be rebalanced to protect European industries and restore a level playing field.

After several months of talks, the sides reached three preliminary understandings:

• Hybrid and plug-in hybrid vehicles: They agreed on steps to restrict Chinese exports to the EU, potentially reducing them by more than half.
• EU access to China’s market: They agreed to work toward lower Chinese most-favoured-nation tariffs on goods including auto parts, olive oil and footwear. The affected EU exports total nearly €4 billion, with expected customs savings of at least €125 million.
• Critical materials: They agreed to further simplify licensing for Chinese exports of rare earth elements and permanent magnets.

Šefčovič stressed that this is only a first step. He said the EU would use its trade instruments if dialogue fails to deliver results. Commission President Ursula von der Leyen is to assess the outcome with EU leaders. Further consultations are planned by January, followed by another round in March.

People Mentioned

• Presenter: Maroš Šefčovič
• Officials: Wang Wentao, He Lifeng, Ursula von der Leyen and Valdis Dombrovskis