EU Sanctions on Chinese Companies Likely To Backfire
Three mainland Chinese firms have been added to a list of companies that EU businesses are banned from dealing with, EU diplomats have said. The firms – the first in mainland China to be targeted by the measures – were accused of involvement in supplying sensitive military technology to Russia.
The measures were expected as leaks had suggested that the EU would take such actions. What is unclear – and potentially dangerous for the EU – is how Beijing will react. China has a habit of applying ‘reciprocal treatment’ to actions both for and against it and will not take kindly to its domestic exporters being targeted.
China’s 2022 bilateral trade with the EU was US$1.03 trillion, and it was the third largest partner for EU exports of goods (9.0% of the EU’s total), after ASEAN and the United States. How Beijing is likely to react will be both swift and targeted. It will have looked at specific industrial areas in terms of EU exports that are both valuable (to the EU), strategic (in terms of damaging EU competitiveness), and designed to promote Chinese business interests.
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The problem with European Union politicians is that they have no idea of which sectors Beijing will target. This means that as and when China retaliates, a very specific EU industry, partially reliant on China, will get hurt without warning. It puts China in control of what will amount to an increasing game of tit-for-tat until something changes.
Meanwhile, during 2023, China’s economy – despite all the negative Western press – grew by some 5.2%. The EU’s grew by 0.6% with some of its largest economies now in recession. Now is in fact, not the smartest time for the EU to be playing trade games with anyone, and especially not a powerful player such as China, with the means to punch back.
We’ll wait and see who China targets. But be assured that Western media won’t be interviewing the European industry players concerned about what they think about the EU imposing sanctions on Chinese businesses and the resulting retaliatory impact.
PROJECT DIRECTOR, MANAGER and CONSULTANT – Senior Civil/Structural Engineer
9 个月Europe is weakening financially, economically and politically, the latter being the reason for the degradation of the first situations indicated. So the only way is to go down the drain fighting against what they created - ECONOMICALLY STABLE AND DEVELOPED CHINESE.
Duhhhhhhh. I think we would do better making monkeys leaders, giving them context & big red buttons.
Palestine Forever
9 个月Politically they sanction, but money always talks louder.