EU extracting concessions through pressure an illusion

European Union leaders have discovered a novel negotiating technique: dig a hole, fill it, then declare victory — and start digging another.

At their meeting in Brussels on Thursday, leaders of the bloc's 27 members appeared determined to perfect this art. Barely a week after painstaking negotiations with China produced a hard-won trade consensus, they were contemplating fresh restrictions on Chinese imports. Diplomacy, it seems, is merely the interval between protectionist offensives.

The timing is revealing. At their second meeting on China-EU trade and investment consultation in Beijing on Oct 8-9, China and the EU reached consensus on 16 points, covering everything from hybrid vehicles and export controls to intellectual property and World Trade Organization reform. Both sides described the talks as productive. A third meeting is scheduled for March. Such progress required compromises from both sides, not capitulation by either.

Yet Brussels appears tempted to interpret China's flexibility and pragmatism as proof that pressure works. Having secured an understanding on hybrid vehicles, EU policymakers now want further "concessions" on new energy vehicles and other manufactured goods.

France and Germany, meanwhile, have identified some chemicals, including polyethylene terephthalate, a packaging plastic, as urgent targets for trade restrictions. The European Commission is considering additional defensive instruments.

Here lies the central contradiction. The consensus was supposed to establish a more predictable relationship between the two economies whose prosperity depends partly on each other. Yet Brussels seems inclined to treat the restoration of normal commercial conditions not as the purpose of negotiation, but as a prize extracted through pressure.

China's willingness to facilitate rare-earth exports, for example, was matched by Europe's commitment to address restrictions on dual-use goods. These were reciprocal undertakings, not unilateral Chinese concessions. To interpret them otherwise is to confuse compromise with capitulation.

The distinction matters because it changes the incentives for future negotiations. If Brussels concludes that threatening restrictions produces concessions, it will have every reason to manufacture fresh disputes. What should be the baseline of an orderly trading relationship — predictable licensing, reasonable market access and the absence of arbitrary obstacles — becomes a reward that must repeatedly be bargained for.

The more successfully the two sides resolve their differences, the more tempting it becomes for some European policymakers to create new problems. A mechanism designed to reduce friction thus risks becoming a machine for generating it.

As a spokesperson for China's Ministry of Commerce stressed on Friday, the claim that EU pressure has “paid off” is groundless.

The EU should harbor no illusions that it can extract concessions through pressure, and it should certainly not underestimate China's resolve and capacity to defend its own interests, the spokesperson said, urging the EU to demonstrate sincerity in resolving issues through dialogue.

China has plenty of instruments to safeguard its legitimate rights and interests. On Friday, the Chinese commerce and science ministries proposed revising export controls covering 40 technologies, including 23 involving artificial intelligence, five involving biomedicine and 12 involving photovoltaics. Fourteen technologies would face prohibition and 26 others restrictions.

The proposals illustrate China's growing command of technologies essential to tomorrow's industries. A country that once depended heavily on imported know-how in some fields increasingly possesses innovations others need. European strategists should factor that into their calculations.

The EU's anxieties are understandable. But tariffs cannot substitute for cheaper energy, greater investment, technological innovation or structural reform. Nor does a trade deficit, by itself, establish unfair competition.

Domestic politics makes protectionism seductive. French President Emmanuel Macron confronts political and fiscal pressures at home; German Chancellor Friedrich Merz faces economic weakness and coalition difficulties. Germany's embrace of tougher restrictions is especially striking given its opposition to European tariffs on Chinese electric vehicles two years ago.

There is another contradiction. France and Germany pursue constructive bilateral engagement with Beijing, including recent diplomatic exchanges and commercial consultations, while endorsing increasingly confrontational positions in Brussels. What sounds pragmatic in bilateral meetings becomes threatening in European communiques.

China's Foreign Ministry spokeswoman Mao Ning has urged Europe to respect openness and WTO rules, arguing that differences can be managed through dialogue. This is not merely diplomatic boilerplate. Interdependence gives both sides every incentive to cooperate and none to escalate.

The EU is entitled to defend itself against demonstrably unfair trade. But treating every Chinese competitive advantage as a distortion risks turning trade defense into industrial self-harm. Worse, interpreting reciprocal compromises as unilateral weakness makes future agreements harder to secure.

Brussels should implement what it has negotiated before inventing fresh demands. Otherwise, Europe risks normalizing the very commercial tensions it claims to be resolving. Digging holes and filling them may keep politicians busy. It is a peculiar definition of economic progress.