(4 November 2025 – Europe) Heightened Chinese competition within the Eurozone is set to intensify as a direct result of global trade tensions, exacerbating sector based issues set in motion during the pandemic.
Stagnant domestic Chinese economic growth coupled with US trade barriers are raising concerns in Europe about rising low-cost competition from China.
While this may generate efficiency gains from a global economic perspective and place a dampener on inflation, the impact on local employment, key industrial sectors and strategic autonomy are ultimately negative outcomes for European policymakers.
“With the development of China’s Strategy 2025, Europe is undoubtedly facing a second ‘China shock’ however this time around it’s largely negative. Not so much, perhaps, if you’re a central banker, and more inclined to embrace the disinflationary impact of cheap Chinese industrial goods but definitely if you are a politician or industry employee witnessing key industries facing painful competition” stated research note author and ING Chief Economist, Bert Colijn.
“While this may ultimately lay the foundation for a move towards even more productive economic activity, geopolitical considerations around strategic autonomy are starting to play more of an important role in this discussion” commented ING Global Head of Macro, Carsten Brzeski.