Brussels to propose ’dedicated’ tool to pull away from China, trade chief says

EURACTIV - The EU should develop new trade tools to reduce its reliance on China, Maroš Šefčovič, the bloc’s trade commissioner, said in Brussels on Friday.

“We are using our existing tools more assertively,” Šefčovič said at the annual Brussels Economic Security Forum. “Where gaps exist, we are also building new tools… Diversification now requires a dedicated instrument.”

The EU’s current “situation, where we are accumulating trade deficits with China at the pace of €1 billion a day, is clearly unsustainable”, he added.

Europe was hit hard in 2025, when China tightened its chokehold over the supply of so-called rare earths, which are used in numerous civilian and military technologies. Beijing controls roughly 90% of global rare earth refining and 60% of global mining.

Tensions were exacerbated by Beijing’s imposition of export controls on Dutch semiconductor company Nexperia, whose chips are largely assembled in China and are critical for automotive supply chains.

“Recent industrial cases, in particular supplies of chips and rare earths, have reinforced my conviction that a step change is necessary,” said Šefčovič. “We understand the urgency for critical minerals but every high-risk sector must be weaned off single-supplier dependence.”

“Economic security is a shared responsibility… We must have their back, but industry must also do its part,” he added. “That means diversifying rapidly and strategically. And integrating the cost of resilience into business models and treating geopolitical risks as what it is – a core business risk.”

Šefčovič’s remarks come after several major EU economies, including France and Spain, sent a letter last month to the European Commission urging it to strengthen its defence tools against Chinese “overcapacity”. Madrid, however, has since distanced itself from the proposal, amid threats of retaliation by Beijing.

They also come after Denis Redonnet, the EU executive’s chief trade enforcement officer, hinted on Thursday that the Commission would soon propose a new trade instrument to combat Beijing’s “very, very intense distortions” of the global economy.

EU leaders will also discuss relations with China at an EU summit in Brussels on 18-19 June. Šefčovič said the Commission will “map out” the bloc’s “overall relationship” with the world’s second-largest economy to leaders at the summit.

Brussels will then receive “political guidance on what concrete tools we should focus [on]”, he added.