Kaja Kallas, the European Union’s top diplomat, recently suggested that ending the continent’s dependence on China was like trying to cure a disease. “Chemotherapy” might be necessary, he said, and would probably be painful.
The comments were an example of the tone Europe is increasingly taking toward China, the 27-nation European Union’s second-largest goods trading partner, after the United States.
As Beijing adopts more aggressive trade policies and Chinese imports to Europe soar, European leaders and companies worry about their dependence on Chinese goods and debate how to step back. As China becomes increasingly dominant in the manufacturing sector, Europe sees an existential threat to its own industries.
“The tone is basically one of panic,” said Jeromin Zettelmeyer, director of Bruegel, an economic think tank in Brussels. “There is a sense of imminent collapse of the industry, of imminent danger.”
Anxiety in Brussels is met with hostility in Beijing, where officials warn that China will respond to any protective measures. The standoff is likely to escalate further in the coming weeks.
World leaders will discuss global economic imbalances at a Group of 7 meeting in Evian, France, next month. China is expected to be on the agenda of a meeting of the European Union’s 27 top leaders soon after.
The European Union’s executive arm is expected to hold an early debate on China policies on Friday that could help set the tone for upcoming discussions.
European officials still express hope that they can work cooperatively with China to alter trade imbalances, which have become more pronounced as Beijing has increased exports to boost economic growth. But they are also considering more powerful trade and industrial measures to curb China’s growing dominance in sensitive fields.
Cutting spending in China could be deeply complicated for Europe. Politicians and companies fear retaliation and consumers are hooked on what China sells. Europeans continue to purchase cheaper Chinese products, especially electric vehicles, which the European Union has already tried, unsuccessfully, to prevent from flooding its market.
“We’re not in a good place,” said Rebecca Arcesati, who works in Brussels for the Mercator Institute for China Studies, a think tank. He noted that European leaders need to deal with voters and more short-term political considerations, and that makes it difficult to counter the flow from China, especially if Beijing retaliates.
“Our systems were not designed to meet such a challenge,” Ms. Arcesati said.
China has subsidies and government programs that have strengthened the position of the country’s factories and companies. The Beijing government has leaned on the industry after a housing crisis left policymakers needing another engine for growth. And as U.S. tariffs made exports to the United States more difficult for Chinese producers, those factories increased their exports to markets like Europe.
In the first quarter of this year, imports from China to Europe increased sharply. An analysis of 2026 customs data by online newsletter Soapbox and the Mercator Institute for China Studies found that China’s trade imbalance with the European Union reached record levels earlier this year as electric vehicles arrived.
The jump came as Chinese automakers faced a drop in domestic demand and moved into Europe. At the same time, European consumers turned to greener alternatives as the war in the Middle East drove up fuel prices.
This followed a goods trade deficit in 2025 of around $418 billion, according to EU figures.
The combination is threatening European manufacturers and their employees, especially in places like Germany, which has traditionally been a big maker of cars and chemicals and is now struggling to compete.
As concerns grow, Europe has turned to tougher rhetoric and bolder ideas.
Emmanuel Macron, the French president and long-time critic of China, has called on the European Union to create measures that protect strategic industries, similar to those the United States has and uses.
Pedro Sánchez, Spain’s prime minister, often seen as one of the most Beijing-friendly European leaders, said during a recent trip to Beijing that the continent needed China to “open up so that Europe doesn’t have to close.”
Spain recently joined France, Italy, Lithuania and the Netherlands in preparing a document urging the European Union to respond aggressively, including with new trade tools. While the document did not single out China by name, it criticized trading partners with “systemic and structural industrial overcapacity.”
Brad Setser, an economist at the Council on Foreign Relations, a think tank, said many European leaders have to proceed cautiously with China for fear of retaliation. But, he added, their fear of manufacturing losses may turn out to be greater than that, even in places like Germany.
Europe is already taking some steps to protect itself, including the proposed European Union Industrial Accelerator Act, a wide-ranging policy aimed at rebuilding the bloc’s manufacturing base. The plan’s design would effectively prevent Chinese companies from benefiting from some key subsidies, particularly helping electric vehicles made in Europe.
That policy has been met with outrage from Beijing, which has denounced the plan as protectionist and warned of retaliation.
But China’s increasingly aggressive stance on trade has contributed to an intensifying European reaction.
Last year, China twice banned exports of magnets and rare earth minerals in retaliation for US tariffs. The bans affect Europe, which uses both materials in high-tech, green energy production.
The supply disruption revealed to European companies how dependent they were.
In April, Beijing unveiled rules giving officials the power to examine corporate records, question employees and even prevent executives from leaving China if they were found to be helping move supply chains out of the country.
According to a recent assessment by the European Chamber of Commerce in China, such a move “could now inflict an unprecedented level of damage on the European economy.”
China’s reaction is partly because Beijing perceives a less unified front against its trade policies as Washington and Brussels clash, said Noah Barkin, an expert on Europe-China relations for the Rhodium Group, a research firm.
Beijing’s “message to Europe is: ‘Your ‘best friend forever’ is gone and even the Americans are looking for stability with us, so don’t test us,'” Barkin said.
