China-EU Relations in China-US Strategic Competition

The Diplomat

16 hours ago

From left to right: António Costa (president of the European Council), Xi Jinping (president of the People's Republic of China), and Ursula von der Leyen (president of the European Commission) at the China-EU Summit in Beijing, July 24, 2025.
The Diplomat author Mercy Kuo regularly engages subject-matter experts, policy practitioners, and strategic thinkers across the globe for their diverse insights into U.S. Asia policy. This conversation with Prof. Reuben Wong, deputy head and associate professor in the Department of Political Science, National University of Singapore, is the 473rd in 'The Trans-Pacific View Insight Series.'
Identify the top three outcomes of the recent China-EU Summit and their strategic relevance for China-EU relations.
Taking place on July 24 to mark the 50th anniversary of the establishment of trade ties between the EU and China, and one week before the August 1 deadline to negotiate deals with the U.S. or face higher tariffs, many observers were anticipating a breakthrough or some reset in the deteriorating relations between the EU and China. After all, China and the EU were the biggest targets of Trump's tariff war, and both were determined to keep access to each other's markets open.
The EU and China sought to minimize their recent public differences (over electric vehicles, the EU's view that China was supporting Russia in the war in Ukraine, etc.), to portray themselves as responsible powers who would uphold global free trade and cooperation. The Chinese media's coverage noted that both China and the EU faced common challenges from U.S. protectionism, especially in sectors like electric vehicles, and had reason to work together to uphold global trade openness. The China Chamber of Commerce to the EU emphasized that economic ties should not be hijacked by geopolitics but serve as a stabilizer for global trade.
The Western media was more skeptical, noting that the summit was cut from two days to one, was moved from Brussels to Beijing, and almost did not happen at all. For a 50th anniversary summit, I would agree that the summit could not boast of any major achievements.
Beijing had no incentive to be conciliatory; the EU's leverage – under pressure from the U.S. ahead of [European Commission President] von der Leyen's meeting with Trump just a few days later – was weakened in its trade talks with China, and it failed to push China on its trade with Russia. But there were important outcomes nonetheless.
Both sides reiterated their commitment to the Paris Agreement and pledged deeper cooperation on green technologies and climate finance. This positions China and the EU as global leaders in climate governance, counterbalancing U.S. retrenchment in many multilateral fora.
China appeared to ease pressure on the EU before the summit with a surge in exports of Chinese rare earth magnets to the EU in May. They also discussed an 'upgraded supply chain mechanism' to help secure stable, long-term supplies to the EU. But while the EU is actively pressing China's Ministry of Commerce to issue export licenses, Beijing may be using this tool as a source of leverage to push back against EU export controls affecting Chinese firms.
There were also signs (but no agreement) that China was taking EU complaints of Chinese overcapacity seriously.
Explain how Beijing is capitalizing on U.S. tariff threats toward the European Union.
Beijing is leveraging U.S. tariff threats in two strategic ways: positioning itself as a reliable trade partner and encouraging EU strategic autonomy. First, China is offering tariff-free access and investment incentives to European firms, especially in automotive and green tech sectors. Second, by highlighting U.S. unilateralism, Beijing reinforces narratives that the EU should pursue independent trade policies. This approach aims to fragment transatlantic unity and deepen China-EU economic ties.
Evaluate Brussels's efforts to optimize the EU's negotiating position amid China-U.S. strategic competition.
Brussels is adopting a multi-pronged strategy involving a strategic autonomy doctrine, the diversification of trade partnership, and normative power projection.
First, the EU is promoting policies that reduce dependence on both China and the U.S., especially in critical sectors like semiconductors and rare earths.
It is also strengthening ties with ASEAN, India, and Latin America to reduce vulnerability to great power pressures.
Finally, Brussels is using regulatory tools (e.g., Carbon Border Adjustment Mechanism, Digital Markets Act) to shape global standards and assert EU influence.
This strategy enhances the EU's leverage by positioning it as a balancing force rather, than an actor subordinate to U.S. or Chinese interests.
Analyze von der Leyen's attempts to forge closer economic and trade cooperation between the EU and the Comprehensive Progressive Trans-Pacific Partnership (CPTPP) countries to advance rules-based free trade.
President von der Leyen has pursued several initiatives.
The EU has initiated exploratory talks on CPTPP accession – informal dialogues with CPTPP members to assess compatibility with EU standards. The EU is also accelerating bilateral agreements with CPTPP member states Australia, New Zealand, and Chile to build momentum toward broader engagement. It is also advocating for rules-based trade, promoting WTO-compatible frameworks and digital trade norms in CPTPP forums.
These efforts aim to counterbalance China's influence in the Indo-Pacific and reinforce the EU's commitment to open, rules-based trade.
Assess salient threats to the durability of transatlantic relations vis-à-vis China-U.S. great power competition.
Key threats include diverging economic interests, technology decoupling, and geopolitical risk perception gaps. EU firms face collateral damage from U.S. tariffs and export controls targeting China, leading to friction over trade policy. U.S. demands for alignment on tech restrictions (e.g., Huawei, AI chips) strain EU autonomy.
Finally, the EU views China as a 'partner, competitor, and systemic rival,' while the U.S. increasingly sees China as a strategic adversary. The EU is also viewing its geopolitical friendships through the prism of external powers' (whether the U.S. or China) support or sanction of the Russian government over Ukraine. Trump's scorn for NATO in his first term, and his attempts in the early months of his second to reach a quick end to the Russia-Ukraine war over Ukrainian and broader EU interests, alienated many European capitals.
Tensions between the EU, U.S. and China risk undermining coordinated transatlantic responses to the war in Ukraine, or any negotiated settlement involving Chinese auspices.