The European Council must agree how Europe will address industrial overcapacity in its relationship with China. The EU’s description of China as a partner, competitor and systemic rival captures the complexity of that relationship. For industrial workers, the consequences are concrete: pressure on production, postponed investment and uncertainty over the future of their workplaces. Europe needs a strategy that addresses the practices sustaining overcapacity and protects European industry while negotiated solutions are pursued.
Trade and cooperation with China remain important, and many European jobs depend on them. But maintaining that relationship requires the EU to address the distortions that undermine it. European leaders must establish what they expect China to change, which instruments Europe will use and how Member States will support a common response.
For industriAll Europe, the objective is to preserve and renew industrial capacity and quality employment across European value chains. Reducing the bilateral trade deficit alone would not demonstrate success. The more meaningful test is whether European sites remain viable, companies invest and workers can see a future for their industries.
The response must match the scale of overcapacity
Europe needs to distinguish between individual instances of unfair trade and structural pressures affecting entire sectors. Anti-dumping and anti-subsidy instruments remain essential where their legal conditions are met. Investigations must have sufficient resources, deliver timely provisional protection where justified and be followed by effective enforcement against circumvention.
However, requiring producers to pursue successive cases can leave Europe responding too narrowly to sector-wide problems. The choice of instrument must follow a clear assessment of the problem. Europe needs to examine capacity developments, subsidies, trade flows and the effects on European production and employment. This assessment should guide intervention before prolonged pressure results in permanent closures. Once furnaces, plants and specialist capabilities disappear, restoring them can be difficult and costly.
A common strategy must also account for connections between industries. Protecting downstream manufacturing while allowing upstream materials and component production to disappear would deepen Europe’s vulnerability. Equally, measures affecting industrial inputs must consider their consequences for European users. Trade unions should participate in these assessments, bringing knowledge of production, restructuring and skills.
International coordination should reinforce European action
Overcapacity also requires cooperation with other affected economies. Europe should promote an OECD-facilitated forum covering additional industrial sectors, drawing on the experience of the Global Forum on Steel Excess Capacity.
Such a forum should improve transparency on subsidies and capacity developments, assess the consequences for employment and support coordinated responses. Trade unions must have a meaningful role in its work. Clear objectives and follow-up should ensure that discussions contribute to concrete actions on how to tackle overcapacity.
This cooperation should complement European trade defence. Europe needs both the capacity to protect its industries and a framework for working with partners to address the root of the problem.
A common strategy needs political support
Europe must prepare for the consequences of its response, including possible pressure on exporters and disruption to essential supplies. Assessing these exposures and supporting affected workers should strengthen the EU’s ability to sustain collective action. Member States must stand behind the common approach.
Negotiations with China must have clear objectives, measurable commitments and a timetable for assessing progress. The Council should agree on how Europe will respond if those commitments are not fulfilled. International cooperation and effective trade defence must support the same objective: addressing the practices, sustaining overcapacity and preventing lasting damage to European industry.
Workers need European leaders to act before productive capacity is permanently lost. The European Council must turn these priorities into a coherent strategy towards China, with clear responsibilities and sustained political backing from Member States.