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Etienne Höra @etiennehoera.d-64.social · 14/10/2026

This week's European Council is only one step in a much bigger discussion about how Europe responds to Chinese competition. The tools are on the table.

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Etienne Höra @etiennehoera.d-64.social · 14/10/2026

Finally, these measures should be embedded in a broader EU growth strategy instead of treating this as an 'either - or' question. This strategy should include a much less fragmented internal market, better access to capital and more support for innovation and emerging industries.

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Etienne Höra @etiennehoera.d-64.social · 14/10/2026

It's essential to define landing zones in negotiations with China: what should the future economic relationship look like, given that a full level playing field won't be achieved in the foreseeable future? The future looks more outcome-based than rule-based, as the hybrid vehicle agreement shows.

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Etienne Höra @etiennehoera.d-64.social · 14/10/2026

My main takeaways: The EU should use and upgrade its existing trade defence toolkit, for instance by putting more staff into trade investigations, instead of waiting for the perfect new instrument. More could be done without major reform.

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Etienne Höra @etiennehoera.d-64.social · 14/10/2026

The policy brief provides a guide to the EU's existing instruments and some proposed new ones, from anti-dumping duties to the shiny new 'decisive and systemic reaction' tool put forward by Merz and Macron. What do these instruments do? How do they work? And would they work in the current situation?

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Etienne Höra @etiennehoera.d-64.social · 14/10/2026

Now, even those firms, sectors and member states, that used to benefit the most from the China business, are losing. Case in point: For the first time, Germany now runs a trade deficit with China on cars. This dynamic paves the way for a tougher EU stance.

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Etienne Höra @etiennehoera.d-64.social · 14/10/2026

EU exports to CN are quite concentrated (more than 40% from DE, DE machinery a bit less than a quarter). Chinese competition affected other countries and industries more.

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Etienne Höra @etiennehoera.d-64.social · 14/10/2026

While there has been a lot of movement in the last few days, the basic diagnosis remains unchanged: China’s export surge, driven by mercantilist policies and weak domestic demand, puts EU manufacturing under massive pressure. Hybrid vehicles are just one pain point among many.

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Etienne Höra @etiennehoera.d-64.social · 14/10/2026

The EU’s China trade debate is coming to a head at the European Council tomorrow. After the Merz-Macron paper and the agreement to limit exports of hybrid vehicles negotiated by Šefčovič in Beijing: what’s still left for the EU to do? My new policy brief looks at the EU's options and instruments.

bst-europe.eu

Your Guide to Europe’s China Shock Trade Debate: Assessing the EU’s Available Instruments

China’s surging exports, driven by mercantilist policy and weak domestic demand, are hollowing out European industry. If the EU finds the right policy mix to address this challenge, it can restore and...

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Etienne Höra @etiennehoera.d-64.social · 06/10/2026

Based on carmakers' reactions to the EU's new steel measures, it also seems that foreign carmakers like to import the steel that they use at home? Back then it was Korean firms though as far as I can remember.

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Reposted by Etienne Höra

Etienne Höra @etiennehoera.d-64.social · 05/10/2026

A few thoughts on today's Franco-German paper on trade with China: 1) Political will is finally there: We've come a long way from the DE's 'no' to EV tariffs to this. This package, esp. the 'new instrument for decisive and systemic reaction' would have been unthinkable a year ago.

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Etienne Höra @etiennehoera.d-64.social · 05/10/2026

A lot of the important work on this is boring, bureaucratic and takes a long time to materialise, especially on de-risking (mining, refineries, etc. etc. etc.). Still more than curious to see what next week's European Council brings.

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Etienne Höra @etiennehoera.d-64.social · 05/10/2026

4) Don't hold your breath: Any new instrument takes time to design and implement. That's why using the existing instruments now is so important. Major confrontation in the coming weeks is unlikely (not impossible).

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Etienne Höra @etiennehoera.d-64.social · 05/10/2026

A big part of the equation will be in which sectors to apply the instruments - cars, machinery, clean tech, chemicals? The Commission won't be able to do everything all at once, even with the additional personnel proposed in the paper.

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Etienne Höra @etiennehoera.d-64.social · 05/10/2026

3) Sequencing is resolved, now it's about prioritisation: he paper (rightly, in my opinion) proposes first using the existing instruments while at the same time developing new ones to close some of the gaps.

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Etienne Höra @etiennehoera.d-64.social · 05/10/2026

2) This strengthens the Commission's hand. Sefcovic will be able to leverage this in Beijing. Won't make CN cave, and we're still far from anything actionable, but a paper by the two most important EU MS shows that the EU is serious about this.

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Etienne Höra @etiennehoera.d-64.social · 05/10/2026

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Etienne Höra @etiennehoera.d-64.social · 01/10/2026

My take on this: The EU needs to figure out how to cushion the impact (and how to pay for that). As a democracy, it has a disadvantage when it comes to bearing economic pain. Compensation can mitigate this and prepare member states for being more courageous than they would be otherwise.

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Etienne Höra @etiennehoera.d-64.social · 29/09/2026

Not to say that it‘s all China, but it does play a big role. Even more so if you look at the structure of the trade and the sectors China goes for (cars, machinery, clean tech, biotech etc.) - basically the EU‘s current industrial backbone and its potential future.

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Etienne Höra @etiennehoera.d-64.social · 29/09/2026

This is one set of numbers, but misses some of the broader context: embedded content passing through third countries (many China-driven supply chains in Southeast Asia), Chinese exports competing with EU exports elsewhere, EU exports to China plummeting (DE now runs a car trade deficit with CN).

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Etienne Höra @etiennehoera.d-64.social · 16/09/2026

No namechecking of new instruments in the making (e.g. the diversification instrument) or trade defence reform, but it‘s still likely that we‘ll see proposals this autumn. Some new cooperation mechanism on raw materials which will be interesting to analyse in detail.

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Etienne Höra @etiennehoera.d-64.social · 16/09/2026

As @noahbarkin.bsky.social has pointed out in his excellent newsletter, the future of the German government will play no small role in how this debate plays out on the EU level, where more instability would likely lead to less assertiveness and more wavering.

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Etienne Höra @etiennehoera.d-64.social · 16/09/2026

The real critical juncture is in October, when the negotiation deadline with China expires. We‘ll also know more about the future of rare earths restrictions by then. The October European Council will be a decisive moment for the China file. For now, the COM keeps its cards close.

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Etienne Höra @etiennehoera.d-64.social · 16/09/2026

#SOTEU continues the China trade debate right where it was before the summer break: VdL calls the trade imbalance ‘unsustainable‘, Highlights the €1bn trade deficit per day and a ‘China shock‘ to EU industry, stresses EU resolve to use its instruments if things don’t change. No big bang moment.

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Etienne Höra @etiennehoera.d-64.social · 15/09/2026

I'll be at the WTO Public Forum for the coming days, let me know if you're around! Focussing on plurilaterals, imbalances, esp. when it comes to China, and how the EU can help drive things forward now.

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Reposted by Etienne Höra

Claudia-Dominique Geiser @cdgeiser.bsky.social · 15/09/2026

We talk a lot about Europe’s scale-up problem and its financing gap, but less about what comes next – the exit for founders and investors. Our new policy brief looks at Europe’s IPO market and why it matters for financing innovation. 🧵 bst-europe.eu/economy-secu... 1/

bst-europe.eu

How to Revive Europe’s Stock Market Listings

Europe’s ability to scale innovation depends on its access to risk capital. Closing Europe’s innovation gap with the US and China will be vital to Europe’s competitiveness. Innovative companies in Eur...

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Etienne Höra @etiennehoera.d-64.social · 10/07/2026

I would disagree that per capita is the relevant metric here. China's exports and their growth can be an international macro problem due to the absolute scale even if smaller countries export more relatively speaking. Otherwise, we'd be looking at places like the Falklands.

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Etienne Höra @etiennehoera.d-64.social · 10/07/2026

I would add the structural imbalances - the Chinese model strongly favours production over consumption and exports over imports. Yes, this also happens in market economies (e. g. Germany), but the scale and intensity really isn't the same. Hard to imagine this in a market-based, democratic regime.

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Reposted by Etienne Höra

Arthur Leichthammer @aleichthammer.bsky.social · 23/06/2026

Great to see the Commission is developing a key missing tool that can increase political unity and strengthen EU trade credibility. @etiennehoera.d-64.social, @aslak.bsky.social and I laid it out last year with a transatlantic trade war in mind: www.delorscentre.eu/en/publicati...

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Reposted by Etienne Höra

Noah Barkin @noahbarkin.bsky.social · 11/06/2026

Full Merz quotes in the Bundestag below. He is signaling that he wants to use the leverage of the European market to enforce free and fair trade. This looks like a clear signal that Germany is on board for tougher measures against China. But the details will matter

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Etienne Höra @etiennehoera.d-64.social · 06/05/2026

Very true - a stable deal with the US just isn't on the table because the US isn't interested, no matter how hard the 'yes' camp tries to push that narrative. The EU can keep blaming itself, we're very good at that, but it would be better to actually implement some safeguards.

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Etienne Höra @etiennehoera.d-64.social · 22/04/2026

Also how many people just ignore the macro stuff? Like sure, we can try working longer hours and cut a bit of red tape, but that won't fix the double digit price gap between EU and Chinese products.

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Etienne Höra @etiennehoera.d-64.social · 17/04/2026

Add to that Chinese stakes in Volvo, Mercedes etc, VW's China exposure (and state funds from the Gulf, on another note) - 'European' is very relative here, anyways.

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Etienne Höra @etiennehoera.d-64.social · 15/04/2026

On another note, I'll be in Tokyo to discuss trade, econ security and everything EU-CPTPP. Drop me a line if you're around and would like to have a chat (or know someone who would)!

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Etienne Höra @etiennehoera.d-64.social · 15/04/2026

Not only that, to many people it's genuinely inconceivable that China, if given the choice, just doesn't want this.

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Etienne Höra @etiennehoera.d-64.social · 15/04/2026

And before anyone tells me that the debate has moved on, it's in the IAA proposal etc. - capitals really aren't there yet (looking at you, Germany, but not only), and some are moving backwards.

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Etienne Höra @etiennehoera.d-64.social · 15/04/2026

This point should be much more prominent when discussing CN investment in the EU - where does it actually add value, and in which ways? Those are empirical questions, and it makes no sense to base policy on just assuming them away. We don't live in econ 101 textbook world.

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Etienne Höra @etiennehoera.d-64.social · 02/04/2026

’The US shooting itself in the foot hurt a bit less than expected‘ really doesn‘t mean that shooting oneself in the foot is a good idea - especially as the original foot-shooting plans didn‘t even last a week.

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Etienne Höra @etiennehoera.d-64.social · 27/03/2026

Illusorisch auch die Vorstellung, irgendeine Art von Abkommen könnte China dazu bringen, sein Wirtschaftsmodell umzustellen. China ist auf massive Exportüberschüsse angewiesen und geht mit dem nächsten Fünfjahresplan noch weiter in die Richtung, in den Industrien, die für DE und EU relevant sind.

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Etienne Höra @etiennehoera.d-64.social · 27/03/2026

Zeigt sehr deutlich, wie verengt die handelspolitische Debatte ist: Die Frage sollte sein, welche Werkzeuge unsere Probleme lösen (extremer Wettbewerbsdruck aus China, Zwangsmaßnahmen, Chaos in den USA). „Welche Abkommen brauchen wir?“ ist eine Folgefrage von vielen, und nicht die dringendste.

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Etienne Höra @etiennehoera.d-64.social · 26/03/2026

At @polis180.bsky.social we use Hootsuite - v good for crossposting and scheduling, not sure whether it also supports reposting at set times.

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Etienne Höra @etiennehoera.d-64.social · 20/03/2026

Agree with @fbermingham.bsky.social about the missing attention span here. Our trade policy apparatus isn't equipped to deal with structural issues at this scale, sectoral measures won't cut it and there's no easy solution that makes everyone better off. bsky.app/profile/fber...

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Etienne Höra @etiennehoera.d-64.social · 20/03/2026

China shock latest - this should get a lot more attention. It's even worse than the year on year data suggests as the deficit jumped by almost 20% 2024 -> 2025 already.

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Etienne Höra @etiennehoera.d-64.social · 18/03/2026

If you care about any EU policy, chances are that money is involved. Great primer on the long-term budget and what to expect in the negotiations.

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Etienne Höra @etiennehoera.d-64.social · 12/03/2026

Die Gründe sind genauso ausgedacht wie die wirtschaftliche Notlage um den "Liberation Day" und die Zahlungsbilanzkrise, mit der die aktuellen Zölle begründet werden - nur eben dieses Mal granularer. Weiter keine Grundlage für einen Deal, allenfalls Risikomanagement und muddling through.

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Etienne Höra @etiennehoera.d-64.social · 12/03/2026

Jetzt beginnen die ersten Verfahren gegen die EU und andere wegen angeblich unfairer Handelspraktiken - Ersatz für die vom Supreme Court annullierten Zölle. Die USA sind daran interessiert, die EU weiter unter Druck zu setzen, nicht an einer Einigung.

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Etienne Höra @etiennehoera.d-64.social · 06/03/2026

That's the way I read it too - there are two kinds of content equivalent to Union origin, one for procurement (including everyone who signed up to WTO GPA) and one for everything else (only FTA partners).

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Etienne Höra @etiennehoera.d-64.social · 06/03/2026

Fair point! I would argue that the question remains though - the amount of extra public procurement money we pay for stuff like cement and paper made in Europe could also be spent on support for more innovative sectors. So there's a balance to be found here.

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Etienne Höra @etiennehoera.d-64.social · 05/03/2026

reminds me a lot of the time when we were discussing whether we should trigger the first step of the ACI procedure as an ultia ratio.

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Etienne Höra @etiennehoera.d-64.social · 05/03/2026

It's almost treated as though breaking our own taboos (local content, joint ventures, investment conditionality) would already solve the problem. EU can do things that look radical when compared to the past *and still undershoot*.

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