EU and Chinese officials are discussing new sectors for trade negotiations, while Brussels prepares to review the implementation of its latest agreement in January. Maroš Šefčovič, the EU's trade chief, raised this issue on Friday.
Assessment of Previous Agreements
Šefčovič said, "In January, we can assess how this agreement has worked and whether all aspects of our agreement have been fulfilled." This refers to an agreement signed on October 9, under which China has decided to reduce hybrid vehicle exports to the EU by nearly half, reaching 350,000 units by 2027.
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This agreement also reduces tariffs on European goods such as auto parts and shoes and facilitates the export of rare elements to the EU.
Trade Challenges and Future Actions
After a scheduled video conference in January with his Chinese counterpart, Wang Wentao, Šefčovič expressed hope that both sides could present tangible results in March 2027 during the next round of in-person negotiations in Brussels. He stated, "I would like both of us to have a common understanding of the sectors we will focus on."
The intense engagement with China comes as this bloc seeks to establish balance in its economic relations. EU officials believe that these relations have been disrupted due to Chinese subsidies, market barriers, and rising imports. Šefčovič emphasized the urgency of this issue, stating that the EU's trade deficit with China reached nearly €197 billion in the first half of this year, and it may break the 2022 record of €397.3 billion.
Šefčovič said, "Part of our team is working on implementing all agreements, and another part is in discussions with their Chinese counterparts about the next sectors. I hope that by holding another trade and investment consultation in Brussels, we can achieve results."
The main goal for the EU is to establish balance in trade. At a press conference on Friday, the official stated that the European Commission is looking to protect more sectors from China's excess capacity, with plastics being the most prominent candidate for protective measures.
Šefčovič continued, "We are currently analyzing what the best candidates and sectors to address are." He added, "Right now, what seems to me to be the closest option is the plastics sector." Brussels is also managing requests from the 27 EU member states, all seeking to protect key industries for their economies.
Ursula von der Leyen, President of the European Commission, told union leaders last week that Brussels wants to support the chemical and machinery sectors in the next phase. Šefčovič also noted that the European Commission is looking to propose new trade tools to encourage European companies to diversify their suppliers, which is expected to be presented in early December.
He said, "We respect what we have heard from every business: keep it simple, no additional reporting." The Commission is also examining a proposal from France and Germany for a new tool that would allow Brussels to restrict access to Europe for countries that severely disrupt the EU's single market within days.
Šefčovič said, "It is better to introduce a new tool. We can set it up quickly and ... act swiftly."
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