EU proposes supply chain limit to reduce China dependence in World Economy News 06/06/2026 The European Union is moving forward with a proposal that would require companies to reduce excessive dependencies in their supply chains as the bloc seeks to reshape its trade relationship with China. “Diversification now requires a dedicated instrument,” EU chief trade negotiator Maros Sefcovic said at a European Policy Centre forum in Brussels on Friday. He said one proposal would require companies to shift supply chains if they source more than 40% of stocks from a single supplier. Sefcovic said he expects EU leaders at a summit later this month to provide the European Commission with political guidance on what “concrete tools” it should pursue to strengthen the bloc’s economic security. The EU faces a €360 billion ($417 billion) trade deficit with China, which also serves as the sole supplier of many critical inputs to the region. The EU has criticized China for not opening its economy and for flooding the single market with subsidized products. Beijing maintains control over critical materials that European companies need, including semiconductors and rare earth minerals. The proposals aim to improve the EU’s leverage with China after years of discussions on market access and overcapacity produced no results, according to people familiar with the matter. The EU seeks to avoid a trade war with Beijing as Chinese officials have warned of retaliation if Europe proceeds with its plans. Sefcovic met earlier this week with Chinese Vice Commerce Minister Li Chenggang and has invited Commerce Minister Wang Wentao to Brussels in the coming weeks to accelerate talks on Europe’s concerns. “What we are looking at internally is how to improve the diplomatic outreach communications and discussions with our Chinese partners,” Sefcovic said. Source: Investing.com 2026-06-06 hellenicshippingnews... tweet Share