EU Seeks to “Swiftly Restrict Market Access if a Trade War Breaks Out” ... With China in Mind?

[Financial News] European Commission President Ursula von der Leyen said, “The EU will develop tools to swiftly and immediately block access to its internal market in the event of a trade war.”
According to AFP on the 17th, von der Leyen said after a two-day EU summit in Brussels, “We will develop new tools that allow us to take decisive action swiftly and immediately by restricting access to the single market when it is in the EU’s interests.”
However, she added, “Let me be clear: the new tools do not replace making full use of existing tools. We must make the fullest possible use of existing tools as needed in each situation.”
Ahead of this announcement, France and Germany sent a joint letter to Commission President von der Leyen last week, calling for the EU to establish legal countermeasures that it could mobilize more quickly in the event of a potential trade war, such as when a country halts supplies of critical raw materials.
China is believed to be the potential target of such measures the EU has in mind. The EU’s trade deficit with China was about €360 billion (approximately 540 trillion won) last year.
Von der Leyen warned that the EU’s trade deficit with China would “worsen further” this year, while EU leaders fear that such an imbalance will deal the EU an additional blow.
Concerns about a trade war eased last week after the EU and China agreed to cap imports of Chinese-made hybrid cars, but China remained a major focus at this EU summit.
Meanwhile, Chinese authorities objected to the EU’s moves on the 16th while urging that the issue be resolved through dialogue.
A Chinese Ministry of Commerce spokesperson warned, in response to speculation that the EU was pursuing a “dual-track” strategy—negotiating with China while simultaneously tightening restrictions on it—that “the EU must not entertain the illusion that it can gain from applying pressure.”
The spokesperson added, “The EU must all the more not underestimate China’s resolve and ability to protect its own interests,” and said, “We urge the EU to promote the healthy and stable development of bilateral economic and trade relations.”
[email protected] Yoo Sun-jun Reporter