China’s growing trade surplus with the EU is raising concerns: 27 countries may face an influx of Chinese goods amid US and China #Tariffs barriers.
⚫ Facts:
• China’s surplus with the EU hit a record $90 billion in the first four months of 2025
• Most redirected Chinese goods flow through Latin #America and Southeast Asia, but Europe is already feeling increased Chinese exports
• The EU is stepping up monitoring of “trade diversion” risks amid the 90-day US-#china tariff truce
⚫ Problems and risks:
• The yuan’s drop against the euro makes Chinese goods even more affordable for European buyers
• Chinese companies are moving up the value chain, displacing European manufacturers
• Protectionism is expected to rise in Europe, including tariffs and non-tariff barriers to support domestic industries
⚫ Automotive market:
• China recorded a record trade surplus with Germany — nearly $12 billion in 2024
• European car exports to China are rapidly falling, while Chinese exports are growing
• Despite EU tariffs on Chinese electric cars, Chinese hybrids and ICE vehicles are actively gaining ground in the European market
⚫ Outlook:
• Europe risks becoming a dumping ground for cheap goods, prompting stronger protective measures
• EU policymakers are preparing to take active steps to protect the internal market amid global protectionism