Europe Moves Toward a Harder Line on Chinese Trade

The European Commission, the executive arm of the European Union, agreed on a tougher approach to trade with China at a rare leadership debate focused on the country. The bloc's trade chief, Maros Sefcovic, argued the European Union needed stronger tools to defend itself, and China vowed to retaliate against any new restrictions.

The central concern is manufacturing. As inexpensive Chinese goods, including electric vehicles, flow into Europe, the continent's industrial base faces a growing threat, and the search for a policy response has become urgent. The two sides disagree on the cause. European officials point to Chinese state subsidies and overcapacity, while China describes the tariffs as protectionism intended to slow its rise.

A widening dispute between the world's second and third largest economic powers would reshape global supply chains and add to the fragmentation of trade into competing blocs. That is a structural shift away from the single integrated market that defined the past three decades.