Europe Still Has Leverage Over China

This analysis argues that Europe's China policy has been based on outdated assumptions of China's unstoppable rise and inevitable liberalization. It highlights China's mounting structural pressures—aging population, property crisis, weak consumption, and high debt—which are driving assertive foreign policy and excess capacity exports. Despite these vulnerabilities, the article contends that China still needs Europe's single market, technology, and industrial know-how. It recommends a leverage-based strategy: protect technological advantages, diversify supply chains, create credible escalation tools like the Anti-Coercion Instrument, and tie dialogue to concrete demands such as curbing export surges and dual-use goods to Russia. The piece warns that inaction risks eroding Europe's industrial base and that a pragmatic, interest-driven approach is necessary to defend European interests without full decoupling.