The EU and China have launched a new trade dispute

The conflict between the European Union and China has escalated over the “Made in Europe” initiative, which aims to protect European industry from foreign competition. The new rules stipulate that state aid will be granted only to companies that use a significant proportion of components manufactured within the EU. 

France 24 reports on the threat of Beijing imposing countermeasures in response to these restrictions.

The main goal of the initiative is to support domestic production in the automotive, metallurgy, and green energy sectors. European manufacturers emphasize that they cannot compete with Chinese goods, whose low prices are driven by significant state subsidies in China. Beijing, however, considers such actions discriminatory and claims they violate the principles of free trade.

China’s Ministry of Commerce has officially warned that it is prepared to take retaliatory measures if the interests of its businesses are harmed. The situation is complicated by a general cooling of relations due to Beijing’s support for the Russian economy amid sanctions. Currently, the parties are continuing negotiations, but the risk of imposing reciprocal trade barriers remains high.