EU walks trade tightrope as US-China rivalry intensifies – DW – 07/15/2025
Last week, China's Foreign Minister Wang Yi held talks with US Secretary of State Marco Rubio on the sidelines of the ASEAN summit in Kuala Lumpur.
The meeting between two top diplomats is especially noteworthy because Rubio has been officially sanctioned by Beijing.
Before he was tapped by President Donald Trump to become US secretary of state, Rubio had served in the US Senate, where he was a member of the Congressional-Executive Commission on China.
The commission is charged with monitoring human rights and the development of the rule of law in China, and submitting an annual report to the US president.
As a member of this body, Rubio sharply criticized the Chinese government for suppressing the democracy movement in Hong Kong, and for drastically restricting civil rights in the western province of Xinjiang.
Beijing lambasted what it saw as "interference in internal affairs" and placed Rubio on the sanctions list after the US government imposed punitive measures on Chinese politicians. The current US state secretary faced an entry ban and a freeze of any assets in China.
Last Friday, the first face-to-face meeting between Rubio and Wang took place behind closed doors in Malaysia.
Neither side revealed much about what was discussed but Chinese state media later reported that the talks were "positive, pragmatic and constructive."
At the Saturday press conference, Wang gave a brief summary of the conclusions made: Maintain contacts, avoid misjudgment, manage differences and expand cooperation.
However, he made no mention of whether Rubio would remain on Beijing's sanctions list.
There is a "strong will" in both Washington and Beijing to organize a meeting between Trump and Chinese President Xi Jinping, Rubio said after the talks. No date has yet been agreed.
While the US still remains the sole global superpower, the gap with China is narrowing.
President Xi wants China to become a "strong, democratic, civilized, and harmonious socialist nation" by 2049, the centenary of the People's Republic.
A study published by the consulting firm PricewaterhouseCoopers (PwC) at the start of 2025 projected that China would overtake the US and become the world's top economy over the next three decades.
The US-China competition is already shaping the global economy and politics today, including trade wars, a global arms race and rising geopolitical tension.
The US is now using its economic might to force all economically weaker countries to compromise on trade. On Saturday, Trump announced a 30% tariff on all imports from the EU from August 1.
According to the DPA news agency, the decree will not apply to steel and aluminum. However, they are already subject to high tariffs. The US, for instance, imposes a 25% tariff on cars and car parts imported from the European Union and a 50% duty on steel and aluminum.
The president of the European Commission Ursula von der Leyen promptly responded, saying that she would take "all necessary steps" to protect EU interests.
At the same time, she said she is prepared to continue efforts to reach a mutually acceptable agreement with Washington. EU Trade Commissioner Maros Sefcovic was scheduled to hold talks with the US side on Monday.
German businesses have sounded the alarm amid the latest crisis.
The tariffs could damage "economic recovery and innovative strength," said Wolfgang Niedermark, member of the executive board of the Federation of German Industries (BDI).
Confidence in international cooperation would also be affected, he added, noting that Germany, as an export-oriented nation, is just as dependent on free trade as China.
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Against this backdrop, the question arises as to whom the EU can rely upon — on the US, an old ally which is now throwing obstacles in the way of globalization, or on the communist party-led China, which is now seeking closer ties with Europe and Germany despite ideological differences.
Is a Trump-led US, like China, now seen seen as a "partner, competitor and rival" for Brussels? This is the question asked by China experts Paula Oliver Llorente and Miguel Otero-Iglesias in a new paper issued by Spanish think tank Elcano Royal Institute. The phrasing is borrowed from EU documents defining its relations with China, with the words also being included in the German government's China strategy in 2023.
"Uncertainty has become the defining factor looming over the strategic positioning of the EU in the context of US-China rivalry," the two scholars claim.
"For Germany, Trump's policies and the US-China conflict present historic challenges," said Claudia Wessling and Bernhard Bartsch, China experts at the Berlin-based MERICS think tank.
They point out that the US administration under Donald Trump upended trans-Atlantic relations, shaking some long-held and deeply entrenched beliefs in Germany. At the same time, Germany also cooled its ties with China despite intensive trade and business links.
Just last week, Germany's Foreign Office summoned China's ambassador after Berlin accused a Chinese warship of aiming a laser at a German aircraft on patrol in the Red Sea. The German plane was deployed as part of an EU-led operation to protect commercial ships from the Houthi militia operating out of Yemen.
But China has disputed Germany's allegations, saying it was "totally inconsistent with the facts known by the Chinese side."
The Chinese Ministry of Defense said the Chinese frigate in question was not in the Red Sea but in the Gulf of Aden at the time.
If Germany manages to set aside all the differences with China and moves closer to Beijing, it would certainly anger Washington, which still binds together the European security architecture. Notably, Russia's ongoing war against Ukraine has brought the importance of US military presence in Europe into sharp focus.
"Germany's new government (...) now faces unprecedented pressure to navigate in a geopolitical world amid an ongoing polarization of society at home," underlined Wessling and Bartsch.
That being said, the EU and the US have substantially different threat perceptions of China, said Llorente and Otero-Iglesias.
"The US is trying to fight a hegemonic competitor and an existential threat, while the EU is aiming to establish a balanced relation with a global player," they argued.
Against this backdrop, the experts underlined, "the EU prefers to develop differentiated de-risking strategies to reduce critical dependencies in its economic relations with China."
The German government's China Strategy, unveiled in 2023, indeed emphasized "de-risking," to reduce reliance on China.
Recent years have also seen many German firms investing not only in China, but also in the US.
However, many actors are now recognizing that these business strategies — such as further relocation to China and, increasingly, to the US — may ultimately run counter to the interests of the German economy, potentially leading to a crisis marked by declining exports and job losses, stressed Wessling und Bartsch.
"Thus, the slogan 'derisking, but doing it right' could prove to be a challenging mandate for the new German government."
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The EU-China summit will take place in Beijing at the end of July. Could this be a new start for Beijing and Brussels? The answer likely depends on Trump.
His administration has already specified tariffs on the EU and its most important Asian allies, saying Washington will demand a 25% levy on imports from Japan and South Korea from August 1.
The latest US plan for goods from China, however, has yet to be announced. If the trade war between the two escalates once again, China might try to use the EU market to absorb Chinese production overcapacity. In turn, the US could also redefine goods manufactured in the EU through Chinese direct investment as Chinese products and demand higher levies from EU businesses.
All EU states must act together to reduce their external dependencies, the Spanish experts said.
"Different Member States have different types of relations and dependencies with both the US and China, as well as individual interpretations of economic security and strategic autonomy," they pointed out.
This "inherent heterogenous nature" of their trade ties leads to divergent foreign policy priorities, Llorente und Otero-Iglesias argued.
Nevertheless, "partnerships are indispensable for the EU," they added. "China will have to, among other things, open its market to European businesses, and this needs concrete actions and not just promises."
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After huge US cuts, who pays for aid in the Middle East now? – DW – 07/15/2025
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Int'l Business Times
2 hours ago
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Tackling Debt 'Curse', France Wants To Slash Holidays
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DW
3 hours ago
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Ukraine updates: EU fails to approve new Russia sanctions – DW – 07/15/2025
EU foreign affairs chief Kaja Kallas said the 27-member bloc did not come to an agreement on an 18th round of sanctions against Russia. Member state Slovakia has been holding up the sanctions package. DW has more. European Union foreign ministers gathered in Brussels for a summit that discussed the bloc's support for Ukraine and tougher sanctions on Russia. At the end of the working day on Tuesday, EU foreign affairs chief Kaja Kallas said the 27-member bloc failed to approve an 18th sanctions package against Russia, as Russia's assault on Ukraine continues. Slovakia has been holding up the package, but Kallas said an agreement could still be reached tomorrow. Meanwhile, Trump reportedly asked Ukrainian President Volodymyr Zelenskyy in a July 4 call if Ukraine's forces could potentially strike the Russian cities of Moscow or St. Petersburg. The White House has pushed back on media reporting on the call, saying it is being taken out of context. 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We can if you give us the weapons," Zelenskyy replied. The also reported on the call, citing a source. The reported that the call between Zelenskyy and Trump conveyed "Trump's determination to squeeze Putin." The White House has disputed FT's framing of the Trump-Zelenskyy call. White House Press Secretary Karoline Leavitt claimed the FT is "notorious for taking words wildly out of context." "President Trump was merely asking a question, not encouraging further killing," Leavitt told the . "He is working tirelessy to stop the killing and end this war." To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video Trump has grown tired with Russian President Vladimir Putin as the Kremlin-ordered invasion of Ukraine continues. During his reelection campaign in 2024, Trump ran on the promise to end the war in Ukraine. Trump announced on Monday that the US will send Patriot missiles to Ukraine to defend itself, with the weapons being paid for by the European Union. The US president on Monday vowed 'very very severe' tariffs against Russia if a Ukraine truce deal is not achieved within 50 days. US President Donald Trump has threatened Vladimir Putin's Russia with tariffs unless it agrees to a peace deal with Ukraine. This has led many to wonder if this sudden turnaround signals the end of the so-called "bromance" between the two leaders. Analyst Boris Vormann tells us that it looks like a major shift, even though Donald Trump has never articulated a foreign policy vision. To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video Ukrainian President Volodymyr Zelenskyy has delivered a eulogy to his country and its people to mark Ukraine's Day of Statehood as it continues to face the full-scale Russian invasion launched in 2022. Zelenskyy spoke of the bond between the many generations that had lived in the country. "This day is about connection," he said. "About every stage of our statehood and about the bond that unites dozens of generations: those who lived in this land a thousand years ago and those who live here today." "A bridge through time, standing on three unshakable pillars: Ukrainians were here, Ukrainians are here, Ukrainians will be here," he added. He went on to say that Ukrainians were motivated to keep going not by praise from the country's allies about how brave and resilient they are but by the desire for self-preservation. "[...] Ukrainians are holding on not for that, not for the loud accolades directed at us. We are simply people defending our home. And we cannot do otherwise — because we do not want otherwise. We do not want Russia here. That is the whole truth," he said. His address also expressed gratitude to the "millions of Ukrainians" involved in defending the country. "It is a great cause, carried by you. The heroes at the front. Those holding the line. Those intercepting missiles and 'Shaheds' every night. Those extinguishing fires, those clearing rubble. And every citizen who has endured throughout this difficult time," he said. "Happy Statehood Day, fellow citizens!" Russian forces have taken control of two villages in the eastern Ukrainian region of Donetsk, much of which is controlled by Russian-backed separatists. In posts on Telegram, the Russian Defense Ministry said its troops had taken Voskresenka and Petrivka. The ministry said Ukraine had lost "up to 125 troops" during the offensive to "liberate" Petrovka. In Voskresenka, up to 185 Ukrainian troops were lost, the ministry said. The battlefield reports could not be independently verified. More now on the Ukrainian drone attacks overnight, which Russian authorities say left 18 people injured. Russia says it shot down 55 Ukrainian drones over five regions in the country's south and southwestern regions. The falling debris damaged homes and commercial buildings in Voronezh, where 16 people were injured. "Sixteen people, including a teenager, were hurt as a result of the attack," Voronezh regional Governor Alexander Gusev said on Telegram. Gusev said most of the injuries were minor, involving cuts and shrapnel wounds. "But there are also injuries of a different nature and serious cases," he added. "One man is in a coma, another has a lung injury." Unverified video shared by a Telegram channel with ties to Russia's security services showed an airborne object smashing into a building on a residential street in Voronezh, the regional capital city. The crash ignited a large fireball. Voronezh's mayor Sergei Petrin said a kindergarten was damaged. In the neighboring region of Lipetsk, a drone crashed into an industrial area of the city of Yelets, leaving one person injured, Lipetsk governor Igor Artamonov said on Telegram. In Bryansk, a region which borders Ukraine and Belarus, one woman was injured in a drone attack on Sluchevsk village, according to Bryansk governor Alexander Bogomaz. Russia has said it needs time to respond to US President Donald Trump's 50-day deadline to end the war in Ukraine or face more sanctions. During the remarks on Monday, Trump also unveiled plans to provide Kyiv with more weapons and impose "very severe" tariffs on Russia's trading partners. Speaking to reporters in Moscow, Kremlin spokesman Dmitry Peskov said Trump's statement is "very serious." "We certainly need time to analyse what was said in Washington." Trump's sanctions and tariffs threat marks a significant shift in approach towards Russia and its invasion of Ukraine, as the White House has grown increasingly frustrated with Putin and the Kremlin over the lack of progress in peace talks. Peskov insisted that Russia, which has rejected previous US ceasefire proposals, is willing to negotiate. Russia is "waiting for proposals from the Ukrainian side on the timing of the third round of direct Russian-Ukrainian negotiations," Peskov said. Russia and Ukraine have held two rounds of direct talks in recent months, but those meetings in Turkey have failed to yield a peace deal. Ukraine has accused Russia of making unrealistic demands, including abandoning its ambitions to join NATO and agreeing to giving up territory in eastern Ukraine that has been occupied by Russian forces for years. The Kremlin spokesman also said Trump's remarks on Monday would likely encourage Kyiv and hinder attempts to bring about a ceasefire. "It seems that such a decision made in Washington and in NATO countries and directly in Brussels will be perceived by Kyiv not as a signal for peace but for the continuation of the war," he said. Dutch Foreign Minister Caspar Veldkamp has also welcomed Donald Trump's announcement that the US will provide NATO countries with weapons for Ukraine. "We need to ramp up pressure on Russia," Veldkamp said. That's the "only way forward," he said, although he did say that Trump's 50-day deadline is "rather long." Speaking to reporters in Brussels, Veldkamp said, "We will look into what we can do also in relation to Mr. Trump's announcements and take it from there," adding that "we're looking into that with a positive inclination." Veldkamp pointed out that the Netherlands has already provided significant military support to Kyiv. He highlighted Patriot missile systems, missile batteries, F-16 fighter planes, portable missiles known as MANPADS, as well as drone cooperation. Asked by DW's Finlay Duncan, reporting from Brussels, about whether it appears that the Trump administration's views are aligning closer with those of Europe, Veldkamp said he is "very glad there's convergence" between Washington and Brussels. He said he "appreciates" that the US seems to finally understand that "Putin is dragging his feet" when it comes to earnestly working towards a ceasefire. Veldkamp also said he was pleased to see the bipartisan support in the US for a sanctions package that has the support of 87 out of 100 senators. "It's very important that the US is on the move and that we're on the move together as EU," he said, adding that he hopes the bloc will approve the 18th sanctions package "sooner rather than later." Latvian deputy Foreign Minister Artjoms Ursulskis has said Riga is confident any remaining issues blocking the approval of an 18th round of sanctions on Russia will be dealt with. Ursulskis, is attending the Brussels meeting instead of Foreign Minister Baiba Braze, who is visiting the US this week. Slovakia has reportedly been holding up the passage of the European Commission's June proposal amid concerns over sanctions on Russian oil. But Ursulskis said ministers would "iron out" those "small details on economic impacts." He also said the focus on the next round of sanctions should be Russia's so-called shadow fleet. To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video Moscow has used a number of opaquely owned and often non-insured ships to sell its oil while circumventing Western sanctions imposed in response to Moscow's invasion of Ukraine, which began in February 2022. "It's not just about sanctioning ships, but companies helping to circumvent sanctions," Ursulskis said, which help "bring in a lot of money for the Russian economy." He said the 18th package of sanctions, once approved, would be "much bigger in its direct impact." "If we shrink Russia's economy, it will be less able to finance war," Ursulskis said. Lithuanian Foreign Minister Kestutis Budrys has welcomed Donald Trump's shifting stance towards Russia, saying "there is still a dance for two with the US." On Monday, Trump announced he would be imposing tariffs and sanctions on Russia and its trading partners unless a ceasefire in Ukraine is reached within 50 days. Budrys said the EU needs "to sync with the Americans and their timeline," calling Trump's deadline a "signal for Europe to prepare itself" in case the sanctions and tariffs do take effect. He pointed out that there are still EU member states that rely on oil from Russia. While the ministers are hoping to agree on a proposed 18th round of sanctions against Russia's energy and financial sectors, Budrys said the bloc should already "start preparing a 19th package." Despite the fact that Russian President Vladimir Putin has yet to change his approach to the war, Budrys insisted that the sanctions "are effective." "Putin has to react when sanctions packages come along," the Lithuanian minister said, adding that "they have secondary effects" and are a factor "Putin listens to." Denmark's Foreign Minister Lars Lokke Rasmussen, speaking to reporters upon his arrival at the European Council headquarters in Brussels, has said his country is ready to purchase US weapons for Ukraine. His remarks come after US President Donald Trump said Monday that the US would sell weapons, including Patriot missiles, to NATO countries, who would then provide them to Kyiv. "I am proud to say we're the biggest supporter of Ukraine per capita, so of course we're willing to do that," Rasmussen said, adding that "it goes hand in hand with the Danish Model." The Danish Model is a mechanism to provide direct support for Ukraine's defense industry Ukraine says the mechanism will provide a total of €1.3 billion ($1.5 billion) in 2025, some of which will be sourced from profits generated by seized Russian assets. Since Russia launched its full-scale invasion of Ukraine in February 2022, Denmark has provided approximately €9 billion in military support and around €867 million in civilian contribution, according to Denmark's foreign ministry. Rasmussen clarified that while Denmark does not have any of its own Patriot missiles, his government should "lean into that" and "provide the money" to purchase the highly advanced missile defense systems. "We must work out the details," Rasmussen explained. But, he added, it is "important we have American readiness to deliver these weapons." The Danish minister also said Trump's new messaging on Russia and Ukraine is "very, very important in terms of accepting providing weapons, but also the sanctions scheme." Read more about Patriot missiles and why they are key to helping Ukraine. US President Donald Trump has said he is "not done" with his Russian counterpart Vladimir Putin. The remarks, made during an interview with the BBC that was published on Tuesday, came hours after he had said he was "very unhappy" with Russia during a meeting with NATO chief Mark Rutte. Since returning to the White House in January, Trump, who had previously pledged to end the war in Ukraine in a day, has tried to bring about peace talks and a ceasefire. But his attempts have fallen on deaf ears in Moscow, with Russia escalating its air strikes on Ukraine last week after Trump and Putin had spoken on the phone. During the interview with the BBC, Trump was asked if he was done with the Russian leader. "I'm disappointed in him, but I'm not done with him. But I'm disappointed in him," Trump said. Asked how he would convince Putin to "stop the bloodshed," Trump said "We're working on it." "We'll have a great conversation. I'll say: 'That's good, I'll think we're close to getting it done,' and then he'll knock down a building in Kyiv," the US president said. Amid his growing frustration over the lack of progress with peace talks, Trump on Monday said he was sending new weapons for Ukraine and threatened tariffs and sanctions on Russia and any countries that trade with it unless Moscow agrees to a peace deal within 50 days. The assertive posture is a major policy shift from Trump, who has previously suggested that Ukraine was responsible for starting the war, echoing Russia's narrative. He also tried to walk back pro-Ukraine policies favored by Trump's predecessor Joe Biden, including supporting Kyiv's membership in NATO and insisting that Russia withdraw its forces from Ukrainian territory. To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video The European Union's foreign policy chief Kaja Kallas said Tuesday that the bloc's members are close to agreeing on a new round of sanctions against Russia. Foreign ministers from the EU's 27 member states are meeting in Brussels on Tuesday to discuss the bloc's support for Ukraine, among other issues. The European Commission in June proposed the 18th package of sanctions in response to Russia's invasion of Ukraine and Russian President Vladimir Putin's refusal to agree to a ceasefire. The sanctions target Moscow's energy exports as well as its banking sector and military industry. The sanctions proposal includes a price cap on Russian oil of 15% below the average market price, as well as bans on transactions with Russia's Nord Stream gas pipelines. "We hope to reach a political agreement on the 18th sanctions package. We are very, very close. I hope it comes today," Kallas said before the meeting. One member state — reported to be Slovakia — has yet to agree to the sanctions package over concerns about the price cap on Russian oil. When asked about the price cap, Kallas said "it's alive." "We have made proposals, but it is a question of whether we can overcome the veto of one member state or not. But we are trying to work on that," the former Estonian prime minister said. Ukrainian Foreign Minister Andrii Sybiha is also due to take part in Tuesday's talks. Sybiha plans to join the meeting by video-link. Russia's Foreign Minister Sergey Lavrov met with Chinese President Xi Jinping on Tuesday. Lavrov, who visited Russia's ally North Korea last week, is in China to attend a meeting of foreign ministers of the Shanghai Cooperation Organization (SCO). "Lavrov conveyed to the Chinese leader a friendly greeting and best wishes from the President of the Russian Federation Vladimir Putin," the Russian ministry said in a statement. "The two sides discussed a number of issues concerning bilateral political contacts ... including preparations for the Russian President's upcoming visit to the People's Republic of China." The Russian president is due to travel to China for a SCO leaders' summit in September. Since it launched its full-scale invasion of Ukraine in February 2022 and Ukraine's Western allies imposed a range of sanctions against Russia, Moscow has increasingly relied on support from China and North Korea. An overnight Ukrainian drone attack on the Russian southwestern regions of Lipetsk and Voronezh has left several people injured and damaged homes and other buildings, Russian authorities said Tuesday. Russia's Defense Ministry said on Telegram that a total of 55 Ukrainian drones were downed overnight over five Russian regions, as well as the Black Sea. Regional governor Governor Alexander Gusev 12 drones were destroyed over the Voronezh border region, where "several people sustained minor injuries due to debris from a downed UAV (unmanned aerial vehicles)." Several apartments in residential buildings in Voronezh, which is the administrative center of the region of the same name, were damaged, as were houses in the city's suburbs, Gusev said. In the neighboring Lipetsk region, a drone crashed in an industrial zone in the city of Yelets, regional governor Igor Artamonov said on Telegram, adding that one person was injured in the attack. There was no immediate comment from Ukraine about the Russian reports of the attack, and the full extent of the damage caused was unclear.
