China signals cooperation with EU on global imbalances amid trade tensions

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China signals EU cooperation

Highlights

China's Finance Minister Lan Foan signals willingness to improve communication with the EU on global economic governance and macro policy coordination in Bangkok.
Lan emphasizes the need for comprehensive assessment of global imbalances, citing the increasing influence of geopolitics and protectionism on structural economic issues.
The EU-China meeting follows a recent deal limiting Chinese hybrid car exports to the EU, as the bloc seeks to address a 360 billion euro trade deficit projected for 2025.

Bangkok talks focus on policy coordination

As reported by Reuters, citing China's finance ministry, Finance Minister Lan Foan tells senior European officials in Bangkok on Friday that China is ready to improve communication with the European Union on global economic governance and macro policy coordination.

Lan makes the remarks in a meeting with Valdis Dombrovskis, the EU economy and productivity commissioner, Christine Lagarde, president of the European Central Bank, and Kyriakos Pierrakakis, the Eurogroup president. In the ministry's statement, Lan describes global imbalance as a complex structural economic issue that is increasingly shaped by non-economic factors including geopolitics and protectionism.

He also calls on all sides to assess imbalances in a comprehensive and objective way, while urging open cooperation and closer coordination of macroeconomic policies.

Trade backdrop sharpens EU-China stakes

The meeting takes place a week after China and the European Union strike a deal to limit Chinese exports of hybrid cars to the bloc, underscoring the wider commercial tensions surrounding the latest economic dialogue.

The EU is seeking to narrow its trade deficit with China, which reaches 360 billion euros, or about $400 billion, in 2025. That trade gap adds pressure to ongoing talks between Beijing and Brussels as both sides weigh how industrial policy, market access and broader geopolitical factors affect economic relations.

In our earlier article on Mario Draghi’s policy warning, we covered his argument that fighting inflation and stabilising debt should not come at the expense of the structural investment needed for future growth. He stressed that central banks should keep rates no higher than necessary for price stability and that clearer policy communication, alongside EU-level measures such as market integration and targeted industrial support, can help limit unnecessary damage to investment and productivity.

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