China warns EU against broad tariffs, threatens trade retaliation

China: China is a major global trading power and key economic partner to the European Union, actively engaged in bilateral trade and investment discussions. In the context of this news, its commerce ministry has issued a direct warning of a resolute response, including potential countermeasures, if the EU pursues broad tariffs or unilateral trade restrictions modeled on US policies. Recent statements emphasize that such moves could undermine ongoing consultations and mutual trust between the sides. European Union: The European Union is a 27-member economic and political bloc that conducts unified trade policy on behalf of its members and maintains extensive commercial ties with China. In relation to this development, EU institutions and member states are advancing proposals for new trade defense mechanisms to address perceived imbalances, with some pushing for tools akin to the US Section 301 framework. The bloc is simultaneously maintaining dialogue mechanisms with China while setting internal deadlines for progress on rebalancing efforts. Policy Proposals: Some EU member states are advancing plans for a new instrument to tackle unfair trade practices, drawing inspiration from existing US measures and prompting Chinese concerns over potential escalation. Trade Consultations: EU and Chinese officials have established a Trade and Investment Consultation Mechanism to address imbalances, export controls, and related issues, with plans for further ministerial meetings in the autumn. Negotiation Dynamics: Both sides continue high-level talks aimed at stabilizing trade relations even as the EU explores stronger protective measures ahead of upcoming internal reviews.