EU and China agree to 3-month talks to prevent trade war over 13 trillion deficit

The European Union and China have agreed to enter into three months of formal trade negotiations, a move designed to avert a potential trade war. The primary objective is to address the substantial annual trade deficit the EU faces with China, amounting to 360 billion euros (about 13 trillion Taiwan dollars).

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dialogue can bring concrete results

This agreement marks the first joint statement from Brussels in seven years and follows weeks of Chinese threats and accusations against the EU. China had warned of consequences if the EU took measures to restrict Chinese goods and components.

Maros Sefcovic, the EU's trade commissioner, expressed his hope for "concrete results" before the next meeting in Beijing in October. He met with China's Minister of Commerce, Wang Wentao, to initiate these discussions. The joint statement emphasizes strengthening dialogue on trade and investment policies to stabilize and rebalance the bilateral relationship.

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The EU and China, as important trading partners, agree that the main objective of the 'Trade and Investment Dialogue' (TIC) is to strengthen ministerial dialogue on trade and investment policies, with the aim of stabilizing and rebalancing bilateral relations.

The negotiations will focus on four key areas: rebalancing trade and investment, export controls including rare earths, intellectual property rights, and World Trade Organization reform. A joint monitoring mechanism will also be established to identify sudden surges in imports or exports, triggering political-level discussions if necessary.

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From a European perspective, we simply cannot afford to continue to see this unsustainable growth in the trade deficit. We simply do not want to wait too long.