In a climate of rising geopolitical instability and fracturing global trade norms, European Union leaders met with Chinese President Xi Jinping and Premier Li Qiang for a high-stakes summit that marked 50 years of EU-China diplomatic relations. The summit, held on July 24 in Beijing, was as much about optics as it was about damage control — a test of whether two of the world’s largest economic blocs could manage growing tensions without allowing the relationship to spiral into open hostility.
This year’s summit, originally intended as a two-day celebration of economic ties and political cooperation, was downgraded to a single-day event amid growing discord. Several pre-summit meetings were cancelled, most notably the flagship High-Level Economic and Trade Dialogue, a development that underscored deep fractures on both the security and economic fronts.
Yet the very fact that the summit went ahead — and that both sides reaffirmed the importance of dialogue — reflects a mutual recognition that despite frictions, the stakes remain too high to let the relationship falter entirely.
The 2024 re-election of U.S. President Donald Trump and his administration’s aggressive return to protectionist and unilateral trade policies have disrupted the global economic landscape once again. In theory, these changes could bring China and the EU closer together. Both Beijing and Brussels are committed to multilateralism and rules-based trade. In practice, however, significant ideological and strategic gaps remain.
According to the latest trade data from early 2024, EU-China bilateral trade exceeded USD $760 billion, making them each other’s second-largest trading partner. But this economic interdependence has proven to be more a source of friction than synergy.
As Xi Jinping remarked during the summit, the two powers stand at a “critical juncture in history” and must “make the right strategic choices” to avoid deeper polarization. EU Commission President Ursula von der Leyen described the relationship as reaching an “inflection point,” urging the need for “real solutions” to sustain cooperation.
At the heart of the EU’s growing security concerns is China’s ambiguous role in the ongoing Russia-Ukraine war. Officially, Beijing maintains neutrality. However, the EU accuses China of acting as a “key enabler” of Russia’s war machine.
In recent months, the EU has imposed sanctions on several Chinese firms and, for the first time, Chinese regional banks, for allegedly aiding Russia in bypassing Western financial restrictions. The latest package includes blacklisting two Chinese banks believed to be helping Moscow procure sanctioned dual-use technologies.
In Beijing, European Council President Antonio Costa called on China to “leverage its influence” with Russia to bring the war to an end — a demand that received a cold but polite response.
Yet Beijing views EU security moves in Asia as equally provocative. Brussels’ growing presence in the Indo-Pacific, particularly its new strategic dialogue on security and defense with the Philippines — a vocal claimant in the South China Sea dispute — has raised alarms in China.
EU Foreign Policy Chief Kaja Kallas’ June visit to Manila triggered a sharp rebuke from Beijing. The Chinese embassy in the Philippines accused the EU of “meddling” and warned against dragging “external forces” into what Beijing sees as a regional issue.
While the EU-China trade relationship remains massive, it is increasingly fraught with accusations of unfair competition, retaliatory tariffs, and protectionist maneuvering. European concerns center on Beijing’s extensive subsidies to state-supported industries — especially in electric vehicles, green tech, and consumer goods — which flood European markets with underpriced imports.
In response, Brussels has erected trade defenses. These include anti-subsidy duties on battery electric vehicles and anti-dumping duties on Chinese plywood. Investigations into Chinese tires and other goods are also underway.
Beijing has counterpunched with its own tariffs and regulatory probes — targeting European brandy, pork, and dairy exports. While China has selectively exempted some major European producers, these retaliatory moves have left Brussels feeling targeted and manipulated.
“The trade measures we see today are no longer isolated skirmishes; they represent a systemic imbalance,” said an EU diplomat close to the negotiations. “We’re now in a tit-for-tat cycle that risks entrenching the very decoupling both sides say they want to avoid.”
Rare earths present a particularly stark example. Since April 2024, Beijing has tightened export controls on these critical minerals, disrupting production in European high-tech industries. Though China recently streamlined some administrative procedures, Brussels insists the export curbs represent unacceptable coercion.
Perhaps the most profound disagreement revealed at the summit is one of perception. For China, economic interdependence with the EU is a strategic buffer — a way to counterbalance the United States and embed itself more deeply in the global economy. For the EU, however, this same interdependence is increasingly seen as a vulnerability — a risk that Beijing could weaponize trade for political purposes.
This perception gap could be the most difficult to bridge. As one European analyst put it: “The problem isn’t trade. It’s trust. And once trust is eroded, no amount of economic benefit can fix that.”
While the headlines may focus on Brussels and Beijing, the fallout from their increasingly complex relationship is being felt acutely in Southeast Asia.
During Trump’s first term, his tariffs on Chinese goods led to a redirection of trade routes, with Southeast Asian countries caught in the middle. A similar dynamic is emerging now, but with greater urgency. If EU-China trade tensions continue, Southeast Asia could become a collateral zone.
Already, some Chinese exporters are suspected of using Southeast Asian countries as transshipment points to circumvent EU tariffs. This could lead the EU to impose stricter rules of origin and customs scrutiny on ASEAN nations, complicating their export operations and raising compliance costs.
Moreover, Brussels’ outreach to ASEAN, seen in recent investment agreements and strategic dialogues, could come under pressure if Beijing views it as part of a broader European containment strategy. A more confrontational EU-China relationship may force Southeast Asian governments to make difficult choices — balancing their deep economic ties with China against the allure of European investment and market access.
At the same time, if Beijing and Brussels can resolve their disputes and stabilize trade, Southeast Asia stands to benefit. Reduced economic volatility would restore confidence in supply chains, and EU-ASEAN trade — already substantial — could expand further. The EU remains ASEAN’s third-largest trading partner, and closer ties could provide a cushion against the broader turbulence unleashed by Trump’s return.
EU-China summit offered no grand breakthroughs, but it did deliver a subtle recalibration. It reaffirmed the importance of engagement — a critical baseline in an era where strategic rivalry is intensifying across every major axis.
Still, major questions remain unresolved:
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Will China ease its support — direct or indirect — for Russia?
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Can the EU and China agree on a framework to reduce the escalation of trade remedies and retaliatory tariffs?
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Is it possible to establish mechanisms for managing security flashpoints, such as the South China Sea, without triggering nationalist backlash?
These issues cannot be resolved in a single meeting, but the willingness to continue dialogue is, at the very least, a hopeful sign. Both Beijing and Brussels appear to understand that the cost of disengagement would be immense — for themselves, for global stability, and for the many regions, such as Southeast Asia, that depend on their relationship.
The EU-China summit of 2024 will likely be remembered not for what it achieved, but for the moment it marked — a cautious recognition that the old assumptions no longer hold, and that a new equilibrium must be found.
What shape that equilibrium takes will depend not only on Beijing and Brussels, but also on how global events unfold. With Washington adopting an increasingly unpredictable and adversarial stance, and Moscow continuing its aggression in Europe, both China and the EU may eventually rediscover the benefits of compromise.
For Southeast Asia, this moment of global realignment is both a risk and an opportunity. The ability of ASEAN nations to navigate these shifting fault lines — without becoming proxies or pawns — will depend on their agility, unity, and capacity to build trust-based relationships with both major powers.
In that sense, the EU-China relationship is more than just a bilateral matter. It is a barometer of the world’s capacity to manage divergence without descending into division — and a test of whether multilateralism can survive in the face of strategic mistrust.
