Strategic Dialogue Highlights Tensions
On July 2, the European Union held its 13th Strategic Dialogue with China in Brussels, a significant meeting co-chaired by EU High Representative for Foreign Affairs and Security Policy Kaja Kallas and Chinese Foreign Minister Wang Yi. The discussions were aimed at addressing critical bilateral issues and setting the stage for an upcoming summit between EU and Chinese leaders scheduled for July 24 and 25 in Beijing. Kallas used this platform to press China on two major concerns: the export restrictions on rare earth elements and the ongoing support from Chinese firms for Russia's war efforts in Ukraine.
According to the EU's diplomatic service, Kallas emphasized the need for China to end what she described as 'distortive practices' concerning rare earth exports. These materials are vital for various high-tech industries, and their restricted supply poses significant risks to European companies and global supply chains. The dialogue underscored the EU's push for a more balanced economic relationship, with Kallas calling for concrete solutions to level the playing field and improve market access reciprocity.
Rare Earth Restrictions and Economic Implications
The issue of rare earth elements remains a contentious point in EU-China relations. These elements are crucial for manufacturing everything from electric vehicle batteries to wind turbines, and China's restrictions have created vulnerabilities in European supply chains. Kallas explicitly urged China to lift these export controls, highlighting how such policies endanger the reliability of global trade networks and impact European businesses.
During the talks, Wang Yi reportedly downplayed European concerns, stating in a subsequent meeting in Berlin that controlling exports of dual-use goods is standard practice. He suggested that Europe's needs could be met if proper applications were submitted, but this response did little to alleviate the EU's apprehensions about economic dependencies and trade imbalances. The ongoing trade spat, further complicated by broader geopolitical tensions, shows no immediate signs of resolution as both sides prepare for the upcoming summit.
Concerns Over Ukraine and Geopolitical Security
Another focal point of the Brussels dialogue was China's role in the Russia-Ukraine conflict. Kallas warned that support from Chinese companies for Russia's military actions poses a 'serious threat' to European security. The EU has repeatedly expressed frustration over the flow of dual-use goods and technology through China to Russia's military, viewing this as a direct challenge to regional stability.
The discussions also reflected broader geopolitical dynamics, including the EU's efforts to navigate its relationship with China amidst external pressures such as U.S. President Donald Trump's tariff policies. As European Council President António Costa and European Commission President Ursula von der Leyen prepare to meet Chinese leader Xi Jinping and Premier Li Qiang later this month, the outcomes of these talks could shape future cooperation or conflict between the two powers. The EU remains committed to engaging constructively with China on global challenges, but the unresolved issues of rare earth exports and Ukraine support continue to cast a shadow over these efforts.