Bloomberg reported on November 3 that the European Commission, which is responsible for EU trade affairs, plans to unveil a package of measures in mid-December to address economic security risks posed by certain imports. The proposed measures are intended to steer European companies toward alternative sources of supply to "reduce China dependence." An earlier Bloomberg article published on October 26 said the EU was considering import quotas and tariffs to curb imports from China in several sectors, including chemicals, furniture and machinery.

The formation of supply chains is the result of long-term market choices and a concentrated reflection of market principles. In 2025, the EU imported more than 160 billion euros worth of electrical machinery, mechanical equipment and parts worth 106.5 billion euros, and chemicals worth 56 billion euros from China. Affordable and high-quality Chinese-made products have provided crucial and hard-to-replace support for the development of EU enterprises. Violating market principles and forcing companies to change suppliers through discriminatory policies will inevitably plunge originally stable supply chains into chaos, thereby driving up production costs and weakening industrial competitiveness.

Many European businesses are reluctant to bear the costs of economic policies pursued in the name of an increasingly broad interpretation of security. In September, the European Commission sought public feedback on its "trade diversification" initiative, which aims to reduce critical dependencies on "a single supplier country" by encouraging more diversified sourcing. Numerous prominent European companies and industry associations submitted feedback, expressing concerns about the Commission's mandatory intervention in corporate supply-chain decisions.

Some submissions went straight to the heart of the problem: The EU's reliance on imports from China in certain product categories stems fundamentally from the lack of competitiveness of its own manufacturing sector. Without addressing this underlying weakness, simply asking companies to switch suppliers would be like putting the cart before the horse.

The European Automobile Manufacturers' Association (ACEA), for example, pointed out that the European automotive industry's reliance on China was the result of investment decisions accumulated over decades of highly successful supply-chain integration. China's competitiveness in auto parts, it argued, offered European automakers the most direct route to producing affordable electric vehicles. ACEA stressed that companies can diversify their supply chains only when credible alternatives are available. For products such as rare earths, battery materials, displays and certain semiconductors, no viable alternatives currently exist. It therefore urged the EU to address the issue from the supply side, avoid requirements such as mandatory local sourcing, and exercise caution in resorting to protectionist trade measures.

The Finnish Battery Industries also argued that the EU should not mandate supply-chain diversification, but instead offer positive incentives. These could include incentives for research and development, faster approval procedures for projects aimed at expanding alternative sources of supply within the EU, improved market-access policies, and assistance to companies in mapping their supply chains and identifying alternative suppliers.

Nokia, the Finnish telecommunications company, warned: "Imposing trade restrictions, component bans or tariff-driven cost increases before alternative sources exist merely penalizes trusted vendors and inflates costs for critical digital infrastructure."

Abandoning competitively priced Chinese products could come at a substantial economic cost. IKEA, the European furniture retail giant, said higher sourcing costs or disruption to established supply chains can affect profitability, investment and jobs across the European value chain, as well as the competitiveness of European production.

The EU's desire to strengthen the resilience of its supply chains is understandable. But pursuing this goal by excluding Chinese products and suppliers is clearly the wrong approach. The EU should acknowledge the shortcomings of its domestic industries, strengthen its manufacturing capabilities and compete fairly with Chinese suppliers, rather than branding Chinese products as economic security risks and using protectionist trade policies to force companies to restructure their supply chains.

Such measures would do little to make European supply chains more secure. Instead, they would impose additional costs and risks on local businesses, ultimately undermining the EU's industrial development and economic interests.