EU-China trade deficit unsustainable, envoy says

European Union trade commissioner Maros Sefcovic said Thursday that the bloc's trade deficit with China was "unsustainable" as he began two days of talks in Beijing aimed at avoiding a trade war.

Sefcovic said on X that his goal was to begin rebalancing the deficit. He said EU businesses in China had told him they needed better access to the Chinese market while improving economic security.

European figures show China exported about one billion euros, or $1.1 billion, more in goods and services to the EU each day last year than the EU sent to China.

Many in Europe blame the gap on what they describe as unfair Chinese trade practices, including state subsidies and price dumping. They also cite supply-chain pressure and currency devaluation. Beijing rejects those claims.

The People's Bank of China said Thursday that China's trade development came from improved international industrial competitiveness. It said China had no need or intention to gain trade advantages through currency depreciation and would not engage in competitive currency devaluation.

The talks come as France and Germany push for a faster EU response tool against possible trade aggression. In a letter seen by AFP, French President Emmanuel Macron and German Chancellor Friedrich Merz called for a credible instrument to respond quickly to escalation, although the letter did not explicitly name China.

China's commerce ministry warned Paris and Berlin on Tuesday against protectionist measures. Foreign ministry spokesperson Mao Ning said Thursday that China hoped to work with Brussels to address concerns through dialogue and consultation.

Sefcovic has identified three priorities: addressing surging imports in strategic sectors, increasing European exports to China and improving access to critical raw materials. The EU also wants clearer export-licensing arrangements for rare earths and other materials after China introduced restrictions last year.

Analysts cited by AFP said a broad agreement this week was uncertain, but possible progress on specific issues could be significant.