Europe’s China anxiety: Will it raise tariffs, weaken the euro or go for structural reforms?

A recent report by the Haut-Commissariat à la Stratégie et au Plan that urged the EU to consider either steep tariffs on Chinese imports or a deliberate weakening of the euro against the renminbi has triggered reactions well beyond Paris and Brussels. What began as a domestic French strategic recommendation has evolved into a wider debate about Europe’s economic direction and its role in an increasingly fragmented global trading system.The proposal, suggesting tariffs of up to 30% or a 20–30% euro depreciation, reflects mounting anxiety over Europe’s widening trade imbalance with China and its erosion of industrial competitiveness.

But the strong international responses underline how consequential such steps would be.Within Europe, reactions have been mixed. Export-oriented economies such as Germany and the Netherlands have signalled caution amid worries about retaliation and supply chain disruptions.

European Central Bank (ECB) officials, while not commenting directly on the proposal, have reiterated that exchange-rate targeting is not part of their mandate, thereby reinforcing institutional limits on currency engineering. Meanwhile, southern European voices more exposed to industrial pressures have shown greater openness to robust defensive measures.Beijing’s response has been firm too, warning against protectionism and signalling that sweeping tariffs would invite counter-measures.

Given China’s demonstrated willingness to target politically sensitive sectors—from agriculture to luxury goods—the risk of escalation is real.The attraction of tariffs lies in their clarity. They are visible, direct and politically communicable.