Ahead of European Council, ECFR’s Andrew Small argues that Europe’s China debate has shifted from recognizing the challenge posed by Beijing to deciding how far the EU is willing to go in responding to it. The key test, he says, will be whether leaders give the European Commission the political backing needed to move from incremental measures to a more systemic strategy
As EU leaders are meeting in Brussels on June 18-19, one of the most consequential discussions is expected to focus on China — not on whether Beijing poses a challenge to Europe, but on how far the European Union is willing to go in responding to it.
Andrew Small, director of the Asia programme at the European Council on Foreign Relations (ECFR), argues that this week’s European Council could mark a significant moment in the evolution of the bloc’s China policy, as concerns over trade, industrial competitiveness, economic security and geopolitics increasingly converge.
- “The issue is no longer whether China poses a systemic challenge — EU leaders now broadly accept that — but whether Europe is prepared to act at the scale and speed required.”
Why it matters: The debate over China is increasingly tied to Europe’s industrial future and economic security.
- EU leaders are weighing how to respond to mounting pressure from Chinese exports on key sectors of the European economy.
- The summit will test the level of political backing member states are willing to provide to the European Commission.
- The outcome could shape the EU’s next phase of economic engagement — and confrontation — with Beijing.
The big picture: According to Small, the debate in Brussels has shifted markedly in recent months.
- Rather than viewing trade distortions, industrial competition, supply-chain vulnerabilities and China’s relationship with Russia as separate issues, policymakers are increasingly treating them as parts of a broader strategic challenge.
- “There is a growing consensus among the Commission and member states that China’s export surge, industrial overcapacity, supply-chain leverage and support for Russia are connected parts of the same problem. As Europe deindustrializes, its dependencies on China deepen, and its security vulnerabilities worsen. Even traditionally market-liberal governments are concluding that preserving an open European market now requires stricter conditions for access to it.”
- That shift is reflected in the questions leaders are expected to discuss this week.
Zoom in: from industrial pressure to strategic rebalancing. Small argues that the immediate concern is the impact of Chinese exports on some of Europe’s most exposed industries. But he suggests that the broader discussion is increasingly about whether the EU can move beyond ad hoc responses.
- “EU leaders are expected to discuss how far Europe should go in rebalancing its China policy. The immediate question is how to respond to the pressure Chinese exports are placing on the most exposed parts of European industry, from chemicals to machine tools; the broader one is whether the EU can move from reactive, case-by-case fixes to a more systemic strategy.”
- According to Small, the European Commission is looking for support in three areas: accelerating the use of existing economic instruments, developing longer-term tools to address concentrated dependencies and sectoral vulnerabilities, and securing political backing from member states in the event of Chinese retaliation.
- “The Commission is seeking backing for three things: faster use of existing economic tools; longer-term instruments to address concentrated dependencies and sectoral pressures; and political willingness to absorb the costs of Chinese retaliation. It will also keep open the possibility of negotiation with Beijing, if China is ready to engage seriously on EU concerns — which so far has not been the case.”
Between the lines: Despite the growing concern about China across Europe, Small does not expect the summit to produce openly confrontational language.
- Instead, he argues that the most important signal will come from the mandate leaders give the Commission.
- “Leaders are unlikely to endorse a ‘tough’ or explicitly anti-China line. They will endorse rebalancing in general terms, and most will want to cloak the China-specific nature of what they are arguing for. The real signal is the strength and conditionality of the mandate they give the Commission.”
- The debate, in other words, is increasingly focused on implementation rather than diagnosis.
What we’re watching: Small outlines three broad scenarios for the summit’s outcome.
- The least likely, in his assessment, would be a weak result marked by visible divisions among member states and a vague mandate for further action.
- “A weak result would mean visible splits among leaders and an ambiguous mandate committing to little. This is the least likely outcome.”
- The most probable scenario would give the Commission room to develop a broader policy package while stopping short of endorsing specific measures.
A stronger outcome would signal a greater willingness among member states to support rapid action. “A moderate result, and the most probable, would give the Commission room to assemble a broad package, including new instruments, but conditionally: a mandate to develop and present options rather than a commitment to specific short-term steps, with member states reserving judgement on what they will actually back.”
- “A strong result would go further: not only a mandate to build the package, but backing to deploy legally grounded defensive measures quickly, with leaders signalling that they will stand behind the Commission and absorb the consequences.”
The longer-term challenge. Even if this week’s summit represents progress, Small argues that Europe still faces a broader strategic dilemma. In a paper released this week, he warns against treating a systemic challenge with a succession of tactical responses.
- “I argue that while developments this week represent progress, there is still a risk that Europe undershoots again, or produces another tactical set of responses to a systemic problem.”
- His argument is that Europe should rely more deliberately on the structural strengths it already possesses: “I call on Europe to instead turn its own system — its regulatory standards, market rules, transparency requirements and coalition structures — into a source of strategic power, underpinned by the weight of the single market.”
The bottom line: The significance of this week’s European Council may not lie in whether leaders adopt tougher rhetoric on China. According to Small’s analysis, the more important question is whether they are prepared to give the Commission the political backing needed to move from a reactive approach to a more systemic strategy — and whether they are willing to bear the costs that may come with it.