Kathmandu. Chinese envoy Wang Wentao and EU top trade official Maros Sefcovic will meet on Monday to discuss ways to resolve trade tensions between Europe and China through dialogue. Sefcovic said his Chinese counterpart Wang will hold talks throughout the day to de-escalate tensions.

The European Union (EU), a group of 27 nations in Europe, has expressed concern over the growing trade imbalance between Asian powers China and has turned its attention to China. The issue has become an existential battle for the EU.

Brussels has warned that a flood of cheap goods produced in China threatens European producers, and fears that an industry could be lost entirely.

Wang’s visit comes less than two weeks after EU leaders ordered the European Commission to hold talks with Beijing to prepare stronger security measures to resolve the crisis and simultaneously protect key sectors.

Sefcovic will welcome Chinese leader Wang to a special dinner later in the evening after talks on whether the current trade imbalance is unbearable for the EU.

The EU’s goods trade deficit reached nearly 360 billion euros ($410 billion) in 2025, meaning the bloc imported more than it exported from China.

Wang will listen, understand and understand the seriousness of the EU’s threat to use trade defence weapons against Beijing.

The EU hopes to avoid a trade war with China, its second largest trading partner. According to the European Commission, China has already given clear signs that it will retaliate against what it considers unjust.

Following Trump’s strategy

Europe has stressed the need for a level playing field, saying Chinese companies have an unfair advantage over large government subsidies.

The numbers support Brussels’ argument. Between 2005 and 2024, Chinese companies received three to eight times more government support than those of the International Organization for Economic Co-operation and Development (OECD). The OECD has called it a “conservative estimate”.

The EU has put in place a number of trade safeguards to address this problem.

In this, higher customs duty can be imposed if the investigation shows that the companies are selling goods at unreasonably cheap prices or that the government has given an unfair advantage to the producers. In case of a sudden increase in imports, safeguards such as quotas can also be imposed. New measures may also be introduced.

The European Commission, which leads EU trade policy, is working on measures to force businesses to diversify suppliers in key sectors such as chips and rare earth.

In May, French President Emmanuel Macron proposed European measures similar to US President Donald Trump’s use of Section 301.

The EU has already taken a number of steps to deal with rising imports from China. The government has doubled customs duty on foreign steel, higher duty on small packets imported from abroad and heavier customs duty on Chinese electric vehicles.

While acknowledging the need for toughness, Brussels has shown no desire to engage in a tragic trade war with Beijing. Beijing has warned that it is ready to respond to any measures it deems aimed at China.

This warning is not just a threat. China has previously imposed tariffs on European cognac and conducted anti-dumping research on pork and dairy products.

The warning is affecting EU capitals.

Germany has so far been more cautious because its economy is more dependent on China, while Spain has been the biggest supporter of Beijing’s pragmatic approach to investing.

Last week, Beijing’s ambassador to the EU, Chai Run, said at an event in Brussels that the EU and China are “partners, not adversaries and certainly not enemies”.

This relationship is also important for China. The EU is China’s second-largest trading partner. After dinner with Sefkovic, Wang is scheduled to leave for London.