Ursula von der Leyen, President of the European Commission, warned in her speech on Wednesday about the European Union's daily trade deficit of one billion euros with China. She issued this warning ahead of intensive negotiations with Beijing before an important deadline in October.
Trade Deficit Has Reached a Critical Point
Von der Leyen will tell lawmakers in Strasbourg: "Our trade deficit with China has now reached one billion euros a day and has reached a critical point." She also referred to concerns about a "second shock from China" and said: "But this shock is already happening. This is evident in our communities and factories across the European Union and is leading to deindustrialization in the heart of industrial Europe. This situation is not sustainable."
Efforts to Establish Trade Balance
The President of the European Commission continued: "That is why we are engaged in dialogue with China to establish balance in our trade. However, these discussions must lead to positive results. China's weaker domestic demand means that the country also needs the European market. Therefore, it is in both our interests to cooperate and find solutions."
However, von der Leyen did not provide details on the actual measures that Brussels intends to take to protect the European industry from unfair competition. Brussels and Beijing are currently engaged in intensive negotiations, with the EU's trade chief set to speak with his Chinese counterpart on Thursday, and a team of senior trade officials traveling to Beijing next week.
Brussels is under pressure to deliver tangible results before the October summit of EU leaders, including regarding trade defense tools against subsidized Chinese exports. Von der Leyen emphasized: "Let me be clear: we will use all available tools to establish balance in our relations. Words are good, but actions are better."
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