Dear ICES friends,
We are delighted to present the latest issue of our biweekly newsletter.
Few relations are as crucial and valuable as the ones - past, present, and future - connecting
Europe and China. At ICES, we believe that regular knowledge-sharing can be the bedrock that empowers
mutually beneficial partnerships and the foundation for fruitful collaborations. Every first and
third week of the month, we highlight the latest developments and fresh ideas across various fields
to enhance cross-continental communication and understanding. We invite you to explore the key
news highlights, insights, and top event recommendations from the past two weeks.
The ICES Takeaway from this Edition
Following the usual August quiet, EU-China tensions are resurfacing in official statements
and media coverage as the October target to demonstrate 'tangible results' in rebalancing
bilateral trade rapidly approaches.
While Chinese exports to Europe are still strong and trade surpluses with individual member
states have risen over the last few months, recent EU regulations on packaging and small
parcels have started to affect the steady flow of goods shipped to the bloc. The summer also
saw a different kind of business booming between the two entities, namely 'low-flow taps,
garden gear and insulated drinkware' as droughts and high temperatures strongly depleted the
old continent's water supply.
As European officials return from the summer recess, revamping the bloc's stance toward
Beijing is back at the top of the agenda. Key member states like Germany and the Netherlands
are now aligning more closely with the European Commission's hawkish trade recommendations,
driven by shifting domestic industry sentiment and growing public support for policy changes.
This shift has not deterred Beijing from defending its state-led industrial policy ahead of
upcoming talks with both Brussels and Washington. Chinese officials continue to reject
overcapacity allegations, attributing their market presence to genuine comparative advantages
instead. Consequently, Chinese manufacturers spanning the plug-in hybrid vehicle and wind
energy segments are maintaining their push into the 27-nation bloc, even as European trade
barriers rise.
ICES wishes you a pleasant read of this edition!
NEWS ROUND
THE WEEKS' HIGHLIGHTS: PROGRESS AND PITFALLS
China, Switzerland Agree to New Trade Deal Scrapping Most Levies
Bloomberg,
August 20, 2026
Following a new trade accord between Switzerland and China, 99.8% of Switzerland's exports to China will receive tariff-free treatment.
EU's Curbs Threaten 27% of Chinese Exports to Bloc, Goldman Says
Bloomberg,
August 24, 2026
Under the EU's new proposals of fresh tariffs, new trade measures as well as existing ones, 27% of China's annual nominal exports to the EU could be affected.
EU-CHINA RELATIONS
China: Slovakia advocates for China-EU dialogue, serves as "safe island" for Chinese
investment: president
Reuters,
August 01, 2026
The Slovak President, Peter Pellegrini, restated the constructive role of Slovakia in the diplomatic relations between China and the EU following his state visit to China.
Chinese EV sales surge to new high in Europe putting tariffs under scrutiny
The Guardian,
August 09, 2026
Thanks to both low tariffs in the UK and high demand in Italy, Chinese electric car sales are on the rise in Europe, reaching 14.2% of the share of BEVs sold in western Europe in 'the first five months of this year, according to Schmidt Automotive Research.'
Why China's traders, e-commerce merchants feel boxed in by new EU packaging rules
SCMP,
August 12, 2026
Chinese exporters now have to contend with the European Union's Packaging and Waste Regulation aimed at minimising packaging and waste, and the resulting costs will very likely put already thin margins at risk.
China's PHEVs, outmanoeuvring EU tariffs, gain traction in Spain
SCMP,
August 17, 2026
Spain's consumers are increasingly turning towards Chinese plug-in hybrid vehicles (PHEVs) as both perceptions about Chinese products are changing, and European tariffs on electric vehicles made PHEVs more appealing.
China opposes EU's abuse of FSR to suppress Chinese companies, urges EU to correct
wrongful practices: MOFCOM
Global Times,
August 20, 2026
As the EU is conducting its investigations into the retailer JD.com, China 'issued another prohibition order targeting the EU's cross-border investigative practices involving Chinese entities.'
The Mistral paradox: Europe's push for tech sovereignty relies on China's Z.ai
SCMP,
August 21, 2026
The French company Mistral will provide access to other companies' models to its consumers, including GLM-5.2, a Chinese open-weight Large Language Model.
China's trade grip tightens in Europe as clock ticks towards October deadline
SCMP,
August 21, 2026
China's trade surpluses with European member states have been mounting during the summer, quadrupling with Sweden and almost doubling with Romania and Finland.
EU awards €1.48m contract to track China investment, trade policy shifts
The Brussels Times,
August 24, 2026
DG Trade of the European Commission awarded a €1.48 million contract to Rhodium Group SAS to 'monitor China's economic policy and track developments affecting economic relations between the EU and China.'
Chinese wind turbine manufacturers target Europe despite political obstacles
Financial Times,
August 25, 2026
While being blocked from expanding in the UK when it comes to offshore wind, Ming Yang, a Chinese wind turbine manufacturer is setting out to establish a long-lasting presence on the European continent.
Dutch government think-tank pushes EU for tougher tariffs and controls on China
euobserver,
August 27, 2026
For the Scientific Council for Government Policy advising the Dutch government, Europe should protect itself from China's imports more stringently and at a quicker rate.
Von der Leyen turns up pressure on China over trade deficit
Euronews,
August 27, 2026
As European Commission President Ursula von der Leyen spoke to a French business organisations' forum, she stated that the 27-nation bloc's relationship with China needed rebalancing, pointing to the increase in trade defence investigations in Chinese products.
Chinese imports plunge 30% to 40% after EU tax on small parcels
Euronews,
August 27, 2026
The newly established EU customs duty on parcels worth under €150 has led a fall of such imports by 30 to 40% since the tax came into effect on 1 July.
German coalition parties seek tougher EU action against China, paper shows
Reuters,
August 28, 2026
Both the CDU and the SPD in Germany are advocating for stronger European protection when it comes to overcapacity, especially in the automotive sector.
Europe drought drives demand for Chinese water-saving goods as EU trade tensions
grow
SCMP,
August 29, 2026
Due to the extreme high temperatures plaguing Europe this summer, Chinese exporters of 'low-flow taps, garden gear and insulated drinkware' saw their business sharply increase.
EU climate chief warns China dependence will make EU's green transition more costly
euronews,
August 31, 2026
The EU Climate Action Commissioner Wopke Hoekstra argues that the short-term costs of reducing dependencies from China would be lower than the long term ones of keeping the situation as is.
GLOBAL GOVERNANCE AND REGIONAL ISSUES SELECTED BY THE ICES
China draws 'red lines' around its economic model ahead of EU, US trade talks
Reuters,
August 02, 2026
Both the Chinese Commerce ministry and Politburo are signalling policy continuity and defending the Asian nation's industrial strategy, as talks with the EU and the USA are drawing near.
Is tech the main battleground as EU and US drift apart? One Chinese prediction says
so
SCMP,
August 04, 2026
According to the China Institutes of Contemporary International Relations, the EU and the USA will have more and more clashes in the future over competition in the tech sector and its regulations.
China and the EU are competing for Namibia's minerals, but the Southern African
country now has to decide who gets the value
Business Insider Africa,
August 05, 2026
Namibia signed in August new cooperation agreements with China on 'energy, mining, infrastructure, agriculture, technical training and green minerals.' Both the Asian country and Brussels are competing to gain access to the African nation's key resources.
EU pushes back against Trump's trade pressure as US targets green rules, China
tariff evasion
Firstpost,
August 15, 2026
Washington is accusing the EU of impeding American exports to the bloc with environmental regulations and allowing taxed Chinese goods to be 'transshipped' to the USA, thereby escaping tariffs.
South Korea challenges China for Arctic sea route to Europe
Financial Times,
August 26, 2026
Seoul is betting on the Northern Sea Route (NSR), the Arctic shipping highway that could allow Asian states to export products to the European market faster, competing in the process with China.
EU must work with South Korea battery makers to cut China risk, experts say
Nikkei Asia,
August 31, 2026
For Consultancy 32, the EU should partner with South Korea to diversify their supply of electric vehicle batteries.
WHAT CAUGHT OUR EYE AND ICES CONTRIBUTIONS: CURRENT RESEARCH AND COMMENTS
China's Trade Defiance Will Come at a Cost
Bloomberg,
August 02, 2026
Juliana Liu is doubtful the EU and China will be able to solve their current trade disputes and perceived imbalances in an amicable fashion. According to one of Beijing's latest policy document, compromise is not in the cards any time soon. The author suggests that the Asian nation would lose more from this strict sense than from offering gestures of goodwill to Brussels, such as scaling back tax rebates on Chinese exporters.
Europe must do more to harness its AI ambitions
Financial Times,
August 06, 2026
Marietje Schaake argues that the EU should move faster on AI and a collective political course on the issue, as actors such as the USA and China have already made it their priority. The upcoming autumn summit of the European Council on this technology could thus be an opportunity for the bloc to come up with a clear cut strategy on AI-related challenges.
Trust the numbers: Germans are open to a more hawkish China policy
ECFR,
August 06, 2026
Nele Anders and Nina Schmelzer look at the data from a recent ECFR polling on the German public towards China and share the somewhat surprising results that 'Germans are the most China-sceptical out of 15 European countries surveyed.' This shift in the public opinion is starting to be reflected among Germany's leaders as well.
Beyond "Forced Transfer": Commercial Lessons for EU-China Clean Tech Cooperation
Heinrich Böll Stiftung,
August 13, 2026
Prof. Li Zheng takes the case study of the heavy-duty gas turbine industry in China and how Beijing managed to achieve technology transfer and indigenous R&D to reflect on the ways the EU and China could collaborate in the clean technology sector while maintaining healthy competition.
[Interview] EU's carmakers face their own Nokia challenge to survive Chinese threat,
says industry expert
euobserver,
August 15, 2026
Petr Knap takes a look at the losses of the EU's carmakers in the Chinese market, the competition from the Asian nation, and the technology revolution towards electric vehicles that will push companies not adapting to suffer the same fate as Kodak or IBM.
Cold comfort: What China can teach Europe about adaptation
ECFR,
August 18, 2026
For Byford Tsang, Europe should learn to source the technology needed to adapt to new climate conditions from a range of suppliers, not just China, even if of course 'China will remain part of Europe's clean-tech supply chains.'
From 5G to NearLink: Europe's next digital dependency risk
Merics,
August 14, 2026
Jeroen Groenewegen-Lau writes about NearLink, China's alternative to Bluetooth and WiFi, as the technology is increasingly embedded in a number of Chinese products. To avoid a new 'Huawei moment' in the EU, he advocates implementing existing legislation, namely the Digital Networks Act and the Cyber Resilience Act. This way, the EU would safeguard its standards while not banning a useful innovative tool.
EVENTS
Over the past two weeks, the ICES has actively participated in a series of events. We are delighted to share some of our insights:
On 21 August 2026, the Center for China-Europe Relations of the Fudan University Institute and the Institute Analýzy-Stratégie-Alternatívy (ASA) in Slovakia co-organised a conference on 'China-Visegrad 4 Relations: The Paths Forward', where Daniel Balazs, ICES' senior researcher, was invited to participate.
Throughout the presentations and discussions, it was notably observed that China-V4 ties focus on expanding tech, trade, and manufacturing under China's 15th Five-Year Plan. Indeed, central Europe leverages lower costs and key logistics to attract Asian capital and diversify non-EU partnerships. To navigate strict European Union regulations, cooperation focuses on pragmatic commercial projects over formal political declarations.
CONNECT WITH US
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LinkedIn: Institute for China-Europe Studies (ICES)
Website: ices-eu.org
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Please note that all news and views cited in this bulletin, if not otherwise indicated, do not represent the position of ICES.