Summary of Key Points
This news article focuses on three main aspects: First, the China Council for the Promotion of International Trade (CCPIT) released the "EU Business Environment Report 2025," which acknowledges the positive outcomes of Sino-EU economic and trade cooperation (such as over half of the surveyed companies having a positive view of the EU's business environment and nearly 50% expressing a desire to strengthen supply chain collaboration), while also pointing out issues such as the EU's tendency towards "pan-safetyism," increased trade barriers, and rising costs. Second, China and the EU have officially established a trade and investment consultation mechanism to provide a dialogue channel for resolving economic and trade differences. Third, in the first five months of 2026, Chinese companies' participation in international exhibitions has improved both in terms of quantity and quality, becoming an important means to stabilize foreign trade and expand markets.
I. Sino-EU Economic and Trade Cooperation: Achievements Despite Challenges
There is increasing interaction and a stronger willingness to cooperate between Chinese and European businesses. Over half of Chinese companies are satisfied with the EU's business environment, and nearly 50% plan to deepen their supply chain ties with EU firms. The three areas most promising for cooperation include the digital economy (with well-established rules and a large market), finance (due to the internationalization of capital markets and extensive experience in sustainable finance), and the green economy (with broad prospects). However, the green economy also presents challenges, as the EU has introduced numerous environmental regulations, such as carbon border taxes, which have significantly increased the costs and operational risks for Chinese companies.
II. Three Major Barriers to the EU Business Environment
1. Pan-Securityism: The EU is conflating normal economic and trade activities with security concerns, implementing measures like the "Critical Raw Materials Act" to regulate raw materials and applying security review processes to industries such as photovoltaics and fiber optics. More than 60% of Chinese companies have experienced such politicalized practices.
2. Increasing Trade and Investment Barriers: Carbon border taxes are not only applied to basic materials (such as steel) but also to downstream products, and the scope of foreign investment reviews has expanded, requiring mandatory reporting for new projects. Over 50% of companies are concerned about making it more difficult to enter the EU market in the future.
3. Rising Costs: The EU's weak economy is coupled with high energy prices, leading to increases in electricity, natural gas, and carbon quotas costs. In cities like Stockholm and Oslo, public utility fees have more than doubled compared to 2020. Nearly 40% of Chinese companies are reporting rising costs.
III. The New Sino-EU Mechanism: A Platform for Dialogue
In June 2026, China and the EU held their first trade and investment consultation meeting, establishing four specific areas of focus (trade balance, export controls, intellectual property rights, and the World Trade Organization) and setting up a joint monitoring mechanism. Both parties exchanged market access lists and agreed to gradually address their respective concerns. For example, they will enhance dialogue on export controls to stabilize supply chains and deepen cooperation in areas such as intellectual property rights and under the WTO framework. This mechanism serves as a communication channel to prevent conflicts from escalating.
IV. International Exhibitions: A Key Tool for Foreign Trade Expansion
In the first five months of 2026, Chinese companies' participation in international exhibitions showed significant improvement:
- Increase in Quantity: The CCPIT approved 513 projects, with 498 actually implemented, representing a year-on-year increase of over 6%.
- Diversified Markets: Emerging markets such as Latin America and Africa have seen the fastest growth (30.6%), while mature markets like Western Europe and North America are also expanding.
- Broader Range of Industries: Traditional industries like machinery and textiles remain dominant, but there is also increased interest from consumer goods and food sectors, as well as emerging industries such as electronics and healthcare. Nearly a thousand Chinese companies attended the CES in the United States, over 350 participated in the MWC in Barcelona, and more than 450 in the Brazilian medical exhibition, showcasing "Made in China" products to a wider audience.
The CCPIT will continue to optimize exhibition management to help companies better utilize these platforms to expand their markets overseas.
Conclusion
Sino-EU economic and trade cooperation holds potential, but challenges posed by the EU's pan-safetyism and barriers are hindering progress. However, the new consultation mechanism offers hope for resolving these issues, and international exhibitions serve as an effective means to stabilize foreign trade. Overall, Sino-EU relations present both opportunities and challenges, requiring both parties to find a balance through dialogue.