France, Italy, Spain, the Netherlands, and Lithuania are jointly pressing the European Union to sharpen its trade defense tools targeting China. The push comes as Europe simultaneously grapples with a significant semiconductor gap — missing roughly a dozen chip manufacturing facilities needed to meet its own demand. Together, these developments signal a broader European pivot toward economic self-reliance and harder stances on Chinese trade practices.
Escalating EU-China trade friction raises the risk of retaliatory tariffs, which would hit European exporters — especially luxury goods, autos, and industrials — with meaningful revenue exposure to China. The semiconductor shortfall also highlights Europe's continued dependence on Asian chip supply chains, keeping pressure on tech hardware costs and supply reliability for European manufacturers.
Ongoing: EU-China trade talks and European Commission response to the five-nation proposal. Watch for any European Commission announcement on new trade instruments in Q3 2025. Also monitor any Chinese retaliatory signals on European goods imports.
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