Is China fighting a trade war with both the U.S. and the EU?

Not officially, but tensions are rising on both fronts simultaneously. The EU's trade deficit with China hit a record €359.9 billion in 2025, and China's surplus with the EU-27 widened to $113 billion in just the first four months of 2026.

Why is Europe's trade deficit with China growing while America's is shrinking?

As U.S. tariffs made it harder for Chinese exporters to sell into America, the excess manufacturing output got redirected toward Europe, which had fewer restrictions in place until recently.

How much has Germany's trade deficit with China grown?

German Chancellor Friedrich Merz said the deficit has quadrupled in five years, and Germany is now losing more than 10,000 manufacturing jobs a month as a result.

What happens if China loses both the U.S. and EU as export markets?

No other single market — including India, Southeast Asia, or Latin America — has the import capacity to absorb the hundreds of billions in exports currently going to the U.S. and EU combined, which is why analysts see this as a genuine structural risk for China's export-led growth model.

Europe vs. China: Why a Trade War Is Becoming Harder to Avoid

Get in Touch

Loading blog post...

Europe vs. China: Why a Trade War Is Becoming Harder to Avoid | Dunham