EU needs to build stronger foundations beneath its economy not a wall around it: China Daily editorial

When Slovak Prime Minister Robert Fico urged the European Union on Tuesday to treat China as a competitor in a friendly spirit rather than an enemy to be walled off, he highlighted a contradiction at the heart of Brussels' China policy: Europe wants the benefits of economic engagement with China while increasingly adopting a strategy designed to constrain the country.

China is not a marginal trading partner that the EU can simply replace. In 2025, EU goods exports to China reached €199.6 billion ($232.88 billion), 37 percent higher than a decade earlier. Machinery, vehicles, pharmaceuticals and precision instruments made up much of those exports, while the EU recorded a €21.3 billion surplus in its services trade with China. For many large EU companies, China is a major market, a supplier of essential raw materials, a production base, a source of corporate revenue and now an innovation hub.

Yet some in Brussels try to frame this mutually beneficial economic relationship through the vocabulary of "de-risking", punitive tariffs, investment screening and export controls, citing the EU's goods trade deficit with China. That risks confusing the symptoms of the EU's competitiveness problem with its causes.

The EU's industrial weakness did not begin with Chinese electric vehicles. It reflects high energy costs, fragmented capital markets, regulatory complexity, slow decision-making and an innovation culture that often rewards compliance more readily than risk-taking. Many EU policymakers are still living comfortably in the bubble of the old division of labor in which China provided manufacturing capacity and increasingly sophisticated products, Russia supplied cheap energy, while the United States provided security and much of the digital infrastructure.

That model no longer applies. Yet the bloc's response has been to protect itself from competition rather than build the capacity to compete.

Artificial intelligence makes this particularly obvious. The AI era rewards enormous computing capacity, abundant capital, entrepreneurial risk-taking and rapid commercialization. The EU instead remains weighed down by regulatory fragmentation and a tendency to debate the risks of technologies before securing a leading position in creating them.

That is why Chinese competition should be treated as a spur to the EU, not as a justification for protectionist measures.

The EU won't gain from aligning its China policy with that of the US. The way the US has treated Canada in their latest trade negotiations should serve as a wake-up call for the EU.

Strategic autonomy means having enough economic strength to compete and policy independence to engage. This is where Fico's notion of constructive competition deserves attention. Competition does not require hostility. What it demands is respect for market rules — not the vague and politically convenient notion of "fairness" that some EU politicians narrowly reduce to a numerical trade balance.

EU companies remain competitive in pharmaceuticals, advanced machinery, environmental technologies, financial and professional services. But Brussels bans high-tech exports to China, which naturally expands the EU's trade deficit.

The China-EU trade and investment consultations launched in June provide a channel to settle these disputes before they escalate to a tariff war.

There is also a human dimension that the China debate in Brussels sometimes misses. In the first half of 2026, China recorded 22.9 million foreign entries, with European bookings surging 275 percent year-on-year amid China's visa-free policy. European travelers experiencing China firsthand encounter a safe and dynamic society. The "China threat" narrative dissipates when confronted with reality.

EU policymakers should also take note of a Pew Research Center survey published last month, which found that public opinion of China is more positive than that of the US in a number of major European nations.

China is not the cause of the EU's economic, trade or industrial challenges. The problems lie closer to home. The EU does not need a wall around its economy. It needs stronger foundations beneath it. The way to compete with China is to make the EU stronger, not to make China weaker.

As Chinese Foreign Minister Wang Yi said last month during a meeting with a cross-party delegation of the European Parliament in Beijing, the EU should stick to the overarching positioning of its ties with China as partnership, refrain from politicizing economic and trade issues and overstretching the concept of security in exchanges, and work for an upward and dynamic balance of trade from a long-term perspective.