The first hundred days of Donald Trump’s second presidency have turned out worse for Europeans than expected. In addition to Vice President JD Vance’s ideological crusade against European liberals, there are fears that the United States will abandon Ukraine and frustration and concern over Trump’s initiation of unprecedented tariffs on European countries. In the wake of these disruptions, it is not surprising that the gaze of some European politicians has wistfully turned toward China, which is perceived by some as a potential hedge against an unpredictable United States. Brussels, for example, recently started negotiations with Beijing on reducing European tariffs on Chinese electric vehicles in exchange for China lowering its tariffs on European goods and lifting export restrictions on rare earth elements. And after Chinese leader Xi Jinping declined to travel to Europe for a 50th anniversary summit on EU-Chinese ties, European Commission President Ursula von der Leyen, skeptical yet pragmatic in dealing with China, announced she will travel to Beijing in late July.
Beijing, meanwhile, is playing its cards well and positioning itself as a more reasonable and cooperative great power than Washington. This is a change from Trump’s first term, when China overplayed its hand and embraced an aggressive “wolf warrior” diplomacy that backfired. Now, not a day passes in which Chinese officials do not underscore how they share their European counterparts’ desire to protect the multilateral trading system from Trump’s disruptions. Xi, for instance, has noted that China and Europe are “two major forces for building a multipolar world, two major markets supporting globalization, and two major civilizations championing diversity.” China has even proposed reviving the Comprehensive Agreement on Investment, which was put on ice in 2021 after Beijing sanctioned several members of the European Parliament who were critical of China. If implemented, the CAI would replace the bilateral treaties that regulate how Chinese investors are treated in European countries and help create a level playing field for European businesses in China.
These are tempting overtures. But the harsh reality is that the game has not really changed: the EU still doesn’t have a China card to play. In fact, Trump’s disruptions are only magnifying China’s economic and security threats to Europe. To offset U.S. tariffs this year, China diverted its exports to alternative markets including Europe. This resulted in a record Chinese trade surplus with Europe in the first quarter of 2025. These low-cost Chinese exports are massively subsidized and undercut European producers who are already facing margin pressures and the imposition of U.S. tariffs. Many of the goods China redirected from the United States to the EU are now competing directly with Europe’s core manufacturing industries—the automotive sector, for instance, as well as electronics, industrial machinery and components, home appliances, and clean energy technologies. This flood of goods could damage the broader competitiveness of Europe’s manufacturing ecosystem, creating something like the “China shock” that rocked the United States in the first decade of this century.
Europe’s security threat from China has not diminished either. The Ukrainian government says it has evidence that Chinese factories inside Russia are producing weapons and that China is exporting gunpowder and artillery to Russia for use in Ukraine. Beijing denies the allegations. If China is bolstering Russia’s military with impunity from both Brussels and Washington, the war in Ukraine is unlikely to end in a cease-fire or a peace agreement in the foreseeable future, and Russia will continue to destabilize not only Ukraine but also the entire European continent.
Seeking détente with China, therefore, is still a dangerous game for the EU. Instead, the EU must realize it has other cards to play, including forging more advantageous trade agreements elsewhere in the world and changing China’s calculus about supporting Russia.
In the economic realm, Europe’s strongest hedge against the U.S. trade war is to secure more agreements with allies, not with China. A central pillar of this strategy should be for the EU to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership—a trade pact among 12 economies, including Australia, Canada, Japan, Mexico, Vietnam, and, more recently, the United Kingdom, that reduces tariffs; sets common rules on trade, investment, and labor; and aims to promote economic integration and strategic cooperation. The growing CPTPP architecture collectively accounts for about 15 percent of global GDP; if the EU were to join, the bloc would represent nearly 30 percent of global GDP.
Trade with CPTPP countries currently represents 15 percent of EU trade and is not sufficient to replace the more dominant trade relationship the EU has with China, but knitting together additional bilateral and multilateral trade and investment agreements with other allies and partners could build a promising hedge against both China and the United States. By adding new sectoral provisions to the Comprehensive Economic and Trade Agreement between the EU and Canada, for instance, the EU and Canada could build mutual resilience against China and the United States, especially in the areas of critical minerals and energy security. Brussels could also prioritize finalizing the EU-India Free Trade Agreement, which would help the EU take advantage of the world’s fastest-growing major economy. This negotiation has long been stalled because of disputes over market access and tariff reductions, but the United Kingdom recently secured its own agreement with India, which could provide a path for the EU to do the same. Similarly, the free-trade agreement that the EU completed in December 2024 with the Mercosur bloc of countries (Argentina, Brazil, Paraguay, and Uruguay) should be implemented as quickly as possible in order to open Europe to vast Latin American markets and the region’s bountiful natural resources.
Europe’s strongest hedge against the U.S. trade war is more agreements with allies, not with China.
Building on momentum from the 2023 Hiroshima G-7 summit, Europe should also deepen coordination on economic and technology security with advanced democracies, particularly Australia, Canada, Japan, and the United Kingdom. These countries must align their strategies to counter Chinese economic coercion and mitigate the risks of China’s civil-military fusion. Joint initiatives should prioritize the protection and advancement of dual-use technologies, especially in AI, quantum computing, and biotechnology. Maintaining a lead in these sectors will require not just defensive measures but coordinated investment in innovation.
Collectively, these same allies can also help sustain high-value scientific research, which the second Trump administration is aggressively defunding at top U.S. research universities and government labs. What could become a generational self-inflicted wound for the United States could also become a generational opportunity for Europe—to attract displaced talent, safeguard R & D programs, and reinforce its own innovation base. Although strong security frameworks will be necessary to prevent intellectual property theft, selective cooperation with Beijing will remain crucial for European companies, especially in the automotive sector, where European manufacturers lag behind, and in battery innovation and clean energy technology, where Chinese firms lead globally.
As Europe expands and reprioritizes its trade and technology relationships with allies and partners, it must also reform the rules and institutions that govern those ties to allow more innovation and investment while protecting core European interests. New frameworks should be built with flexibility in mind to allow the United States, under a future administration, to participate. Strategic patience and careful design today can lay the groundwork for a renewed transatlantic partnership tomorrow.
Insulating itself from trade shocks, however, is only step one: Europe must also stop underestimating China’s support for Russia’s war against Ukraine, which in turn threatens European security. During the Biden administration, the United States condemned China’s support of the Russian industrial base, but Europe has been more cautious and has rarely threatened Beijing or followed through with serious consequences. Beijing has stopped short of delivering weapons directly to Russia, which President Joe Biden warned is a redline. But China’s supply of dual-use goods, such as semiconductor chips and weapons parts, has taken on such proportions that it has become the equivalent of providing lethal aid: Carnegie estimates that, in 2023, China was responsible for roughly 90 percent of the goods that Russia needs to sustain its war effort. An internal EU report this year estimates that China is responsible for approximately 80 percent of all circumventions of sanctions against Russia.
This support allowed Russia’s military to reconstitute itself much faster than many NATO analysts expected after the massive losses in the first year of the war. Yet pressure on China for its obstructive role has almost disappeared. Trump administration officials have declined to push for greater scrutiny of China’s role in the war and have instead repeatedly suggested that China can help end the war in a positive way, without following up with any pressure on China to do so. European governments, meanwhile, say they oppose Beijing’s involvement while doing little to genuinely punish or deter China: so far, Europe has sanctioned only a few dozen Chinese companies for delivering dual-use goods to Russia.
Ukraine has tried to keep its partners focused on China’s involvement and to demonstrate that Beijing’s support for Russia is intensifying. Kyiv has claimed, for instance, that more than 150 Chinese mercenaries are fighting alongside Russian forces in Ukraine and that Beijing has done nothing to rein them in. Ukraine has also pointed to China’s willingness to cross the dual-use line, claiming it has evidence of China’s direct involvement in weapons manufacturing inside Russia. Yet precisely because China is no longer facing any significant backlash from the United States or Europe, Beijing has moved to take advantage of the newly permissive environment. During a summit last month in Moscow, which coincided with Russia’s annual commemoration of the Allied victory in World War II, Putin and Xi pledged to “enhance (their) strategic coordination.”
Europe must stop underestimating China’s support for Russia’s war against Ukraine.
Moscow is also taking advantage of European inaction. Because it can rely on China’s support for its military needs, Russia believes it can outlast Ukraine. Increasing pressure on China for its support of the war, therefore, is one of the best methods by which the United States and Europe could increase pressure on Russia to agree to a cease-fire. Military analysts believe that Russia is planning a summer offensive in which it will expend its stockpile of weapons; afterward, it will rely on what it can produce from day to day, heightening its dependence on the supply chains it has built with other countries. At that point, sanctions that bite at Chinese supply lines to Russia could become particularly effective.
Even if the United States is not on board with such sanctions, Europe has a lot of leverage of its own. The flip side of Europe’s trade dependence on China is China’s own reliance on Europe’s market to absorb its excess capacity. Since Trump’s tariff announcements against China and the diversion of U.S.-bound Chinese goods to Europe, Europe is now an even more important market for China’s exports; Europeans should use that leverage to ramp up the pressure on China. Instead of merely sanctioning Chinese companies that trade in goods that are of use to Russia’s military, the European Union should apply sanctions on Chinese banks that help Russia circumvent the EU’s sanctions regime. And if China truly wants to pursue a revival of an investment agreement with Europe, Brussels should condition any talks on China restricting the flow of dual-use goods to Russia’s military.
Europeans also have an opportunity to take advantage of China’s role on the sidelines of negotiations to end the war in Ukraine. China has invested a great deal of political capital into portraying itself as a potential neutral mediator in the war, albeit with pro-Russian leanings. This is now, ironically, the same role that the Trump administration has assumed, and there are signs that China suspects it is being left out. According to The Wall Street Journal, Chinese officials proposed hosting a Putin-Trump summit and offered to facilitate peacekeeping efforts in Ukraine, but Washington wasn’t interested. Europeans should signal to Beijing that it could be in China’s interest to take a step back from being so obviously supportive of Russia, while arguing neutrality.
Increased pressure on China will not, of course, result in Beijing abandoning Moscow. Nor will more free-trade agreements completely make up for the economic losses in a trade war with the United States and diminishing returns from trade with China. But regardless of how hostile the Trump administration (and Trump himself) is to the EU and how sweet the gestures are from Beijing, Europe must remember that China is not its friend. Europe cannot hedge against Trump’s disruptions by selling out its own economy and security.
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