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China-EU relations
EconomyChina Economy

China-EU trade ties are at a crossroads. Could tech bridge the divide?

A hostile Washington is creating openings for a reset – but deep-seated issues remain, analyst says

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China-EU relations have suffered in recent years, but the Trump administration’s hostility towards the bloc has raised hopes for a reset. Several high-profile European leaders have headed east in recent months, though deep concerns over China’s export machine remain. Photo: Reuters
Mia Nurmamat
Premier Li Qiang has called for deeper technological cooperation with Germany and highlighted opportunities under China’s latest five-year plan – a move that could help ease tensions with the EU over the war in Ukraine and years of trade disputes.

“We support bilateral flows of innovation resources between enterprises and research institutions in both countries,” Li told a symposium attended by German Chancellor Friedrich Merz and more than 60 business representatives from both sides.

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“We can have deeper joint technology development, shared research platforms and broader results sharing, while encouraging companies to explore third-country markets together,” he added, according to state-run news agency Xinhua on Wednesday.

Li’s remarks came during Merz’s first visit to China since taking office in May, at a time when US President Donald Trump’s increasingly confrontational stance towards the bloc is forcing EU nations to recalibrate their China policy.
Merz, who had previously taken a tough line on China and warned corporate executives against major investments there, has now joined a growing list of European leaders who have recently visited the country, including those from Finland, Ireland, France, Spain and the United Kingdom.

Analysts said Berlin was adopting a more pragmatic approach as US-China competition intensified, with countries caught between the two superpowers needing to rethink diplomatic relations with Beijing.

“I would characterise his approach towards China as pragmatic rather than purely conciliatory. It is anchored in a shifting geoeconomic and geopolitical reality where Germany must juggle multiple disruptive forces,” said Alfredo Montufar-Helu, managing director at Ankura China Advisors.

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He noted that China’s business landscape had changed, with softening demand and intense price-based competition at home challenging profit margins. This was spilling over globally, with Chinese firms expanding their footprint in Global South markets where Western multinationals had once dominated, he added.

Europe’s security anxieties had also deepened amid the Ukraine war and the Trump administration’s shifting stance on Nato, he said.

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