EU manufacturers could stop competing with China by 2030, chamber chief warns

Jens Eskelund, who heads the EU Chamber of Commerce in China, arrived in Brussels with a blunt message: European manufacturers could hit an existential crossroads by the end of the decade. After back-to-back meetings with European Commission officials to hand over feedback from Beijing, the Danish businessman said companies may soon find themselves asking: “What is the point of trading?”

The backdrop is stark. The EU's deficit with China is running at a record £1bn (€1.18bn) a day, and a Goldman Sachs report cited by Eskelund forecasts Chinese exports will shave 0.5% off EU GDP by 2030 and as much as 0.9% off Germany's. He painted a doomsday scenario in which European manufacturing disappears, the tax base collapses and countries face multigenerational unemployment and spiralling social benefits costs.

The squeeze is already landing in cars, chemicals and renewable energy. German automakers are caught between shrinking profits in China and cheaper Chinese competition at home from BYD, Geely and SAIC Motor, with BMW reporting a 22% drop in China sales in the first nine months of the year and issuing its second profit warning this year.

Eskelund pushes back on the phrase “China shock 2.0”, arguing Beijing's export surge was telegraphed in every five-year plan since the Made in China strategy was agreed in 2015. A Centre for European Reform report urged Germany to stop “admiring” Beijing, noting China's 2026-2030 plan doubles down on self-reliance in AI, quantum computing, robotics, biomanufacturing, brain-computer interfaces and 6G.

His answer is not retreat but embedding. European companies, he said, can compete with Chinese supply chains by becoming part of them — a shift from “Made in China for China” to “Made in China for the world” — and chamber members have reported an uptick in confidence over the past year. He dismissed the idea that Europe can close the gap by exporting more as “fantasy”, with China's surplus against the rest of the world expected to surpass 2025's record $1.2tn and its currency running about 30% undervalued.

His pitch to EU leaders: engage with China and find where both sides see value. “China has always been very focused on outcomes, whereas Europe has been more focused on principles,” Eskelund said, adding that it raises the question of whether following principles is delivering undesirable outcomes.