Germany has changed course. For years, it was cautious about China; now it wants to take a tougher line. Thousands of industrial jobs disappear every month in Germany, and the picture elsewhere in Europe is much the same. The trade deficit is approaching €1 billion a day. Sector after sector is under pressure. China is also tightening its restrictions on supplies of critical raw materials.
First gradually, then suddenly, Europe’s debate on China is shifting. In Berlin and elsewhere, the message is now: this cannot continue. We must stand firm, even if that provokes Chinese retaliation and escalation.
And although delay may indeed no longer be an option, the timing could hardly be worse. Europe already has its hands full with an escalating Russia, a Donald Trump moving increasingly in a pro-Russian direction, and a war in the Middle East that we did not want but whose consequences we are feeling.
Europe is also under political pressure: mass demonstrations in Paris and other major cities, and a cycle of elections ahead carrying a serious risk that the far right will take power in one or more European countries. So yes, a bad moment for a showdown with China.
Mild contempt
What does the picture look like on the Chinese side? Anyone visiting China today encounters a country brimming with confidence. We are ready for the future, the Chinese say, and you are not. They point to their technological capabilities. They say they understand better how to survive in a world without rules. And they look at Trump and feel they have the upper hand. Unlike others in Washington, Trump himself has little appetite for a struggle for hegemony or for defending Taiwan. And Europe? With mild contempt, the Chinese look at a continent that seems to have lost its way.
But this outward confidence contrasts with domestic concerns. On a recent EUISS visit to China, we saw how fragile the situation is. Officially, economic growth stands at 4.5 per cent, but behind closed doors analysts speak of less than 3 per cent: a figure we in the West can only dream of, but historically low for China. Youth unemployment officially stands at 18 per cent, but informal estimates often put it above 30 per cent. And people in the financial sector say that roughly one in five loans is currently not being repaid. China, in short, has far greater problems than it cares to admit and that creates opportunities for us.
China’s internal weaknesses make access to the European market all the more important, particularly as the United States and other countries increasingly take measures against Chinese overcapacity. Moreover, the Chinese government has a clear interest in stability ahead of next year’s party congress.
Europe therefore holds more cards than it thinks. Now it must play them wisely. We must keep negotiating with China, while also taking steps to strengthen our position. That starts with supporting sectors suffering badly from Chinese overcapacity and state subsidies. Tariffs and import quotas on Chinese products can help.
But what if Beijing retaliates? Proposals are ready in Brussels. French President Emmanuel Macron and German Chancellor Friedrich Merz want the EU to be able to act swiftly against “severe, systemic market distortions”, if needed by restricting access to the single market for an entire sector. The Commission also wants the EU to support countries targeted by economic pressure. There is strength in numbers.
The logic is clear: escalate in the expectation that this will ultimately bring de-escalation. As with military deterrence, this approach depends on credibility. Does Beijing really believe Europe is prepared to defend its interests? The European Council of 15–16 October offered grounds for hope, giving the Commission political backing. Member states called for all existing instruments to be used and for Europe’s toolbox to be expanded swiftly. All this improves the chances that negotiations with China will actually deliver.
Alongside this lies a second, more geopolitical danger. Diplomacy over Ukraine is gathering pace again. Nothing suggests that Vladimir Putin genuinely wants peace, but Europe must ensure that negotiations and decisions are not conducted over our heads. Alongside the US, China also has an important role to play.
Plans are being drawn up for a meeting between Presidents Xi, Trump and Putin on the sidelines of the APEC summit in Shenzhen on 18–19 November. Perhaps it will amount to little more than a photo opportunity. But there is also a risk that the meeting could produce a “new Yalta”, with the great powers effectively dividing up the European continent.
Uncertain outcome
Europe can guard against this risk in two ways. First, Europeans should remind the Chinese of a diplomatic principle they themselves claim to uphold: “nothing about us without us”. Efforts to end the war in Ukraine must therefore directly involve all parties, including Ukraine and other Europeans.
Second, Europe must take diplomacy over Ukraine into its own hands. At present, Europeans leave it to figures such as Steve Witkoff and Jared Kushner, with their dubious diplomatic skills, while awaiting the uncertain outcome of a summit in China. The taboo on talking to Putin must go. It was therefore welcome that Finnish President Alexander Stubb and Norwegian Prime Minister Jonas Gahr Støre spoke to Putin this week. But what we really need is a single European negotiator with a clear mandate to conduct diplomacy on Ukraine on behalf of us all.
In a world of power politics, Europe must dare to use its economic power as a means of pressure and pool its diplomatic influence. Europe is perfectly capable of doing so and needs no one’s permission.
This opinion piece by Steven Everts was originally published in Dutch in NRC on 29 October 2026 under the title, 'Wij Europeanen hoeven heus niet onder de indruk te zijn van China'. It is reproduced here in English with the permission of NRC.
