EU trade officials are developing a 'diversification instrument' to require companies in critical sectors to expand their supplier base and curb reliance on Chinese goods.
Key facts
- •Ditte Juul Jorgensen stated that the EU's increasing trade deficit with China is an 'untenable situation.'
- •The proposed Industrial Accelerator Act would bar specific Chinese products from public procurement contracts.
- •The new rules aim to mitigate risks associated with concentrated dependencies in strategic sectors.
- •Ditte Juul Jorgensen replaced Sabine Weyand as the EU's trade director in June.
- •EU officials report that China is currently engaged in ongoing trade talks despite significant challenges.
The European Commission is drafting new trade regulations aimed at reducing the bloc's economic dependence on China. Ditte Juul Jorgensen, the commission's director-general for trade and economic security, announced the plans during a hearing with the European Parliament’s international trade committee on Wednesday, September 2.
Proposed Trade Measures
The proposed 'diversification instrument' would mandate that companies operating in critical sectors increase their number of suppliers. This initiative is part of a broader series of trade defense measures designed to address what officials describe as an 'untenable' trade deficit and increasing concentration dependencies in strategic industries.
Additional Industrial Policies
Beyond the diversification rules, the commission is planning to address the oversupply of Chinese industrial goods. These efforts include the proposed Industrial Accelerator Act, which aims to restrict certain Chinese products from public procurement contracts and place limits on the acquisition of European companies by Chinese entities.
Diplomatic Engagement
EU officials are currently engaged in discussions with Beijing regarding these trade challenges. Denis Redonnet, who leads the EU’s negotiating team, has been holding talks in China this week, and Juul Jorgensen plans to visit Beijing later this month to continue the dialogue.
Timeline
- JuneDitte Juul Jorgensen replaced Sabine Weyand as the EU's trade director.
- Wednesday, September 2Juul Jorgensen presented the new diversification plans to the European Parliament’s international trade committee.
- Later this monthJuul Jorgensen plans to travel to Beijing for further trade negotiations.
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This article was independently rewritten by ManyPress editorial AI from reporting originally published by EUobserver.
