In the current environment, where the international trade system is increasingly becoming a tool of geopolitical competition, the European Union (EU) is reshaping its industrial policies within the framework of “strategic autonomy.” A key element of this restructuring is the “Made in Europe” plan, introduced in March 2026, which prioritizes domestic products in public procurement. These steps taken by the Union to protect its own industry are causing tension in its relations with China, one of its largest trading partners. The EU views its external dependence, particularly in the areas of critical raw materials and clean energy technologies, as a security risk and is pursuing a policy of economic risk mitigation (de-risking). China, however, perceives this as a form of commercial exclusion. Therefore, the sustainability of the EU’s economic reforms and their position within the current dynamics of the global system emerge as a strategic issue that requires careful scrutiny.
The Industrial Accelerator Act, which forms the economic foundation of the EU’s vision for strategic autonomy, aims to limit Europe’s external dependence, particularly in the fields of technology and the green transition. At the core of the plan is the requirement that, to qualify for public support and incentives, at least 70% of components in certain strategic products—such as electric vehicles and renewable energy equipment—must be of European origin, and assembly must take place within the EU’s borders. This approach ties European manufacturers to state support rather than forcing them to compete with cheaper and more innovative Chinese products. Brussels characterizes these steps not as protectionist policies, but as an effort to ensure supply chain security and build a network of “reliable partners.”[i]
Regarding this matter, French Foreign Minister Stéphane Séjourné stated, “China remains an indispensable partner, but balance must be restored in our relations.”[ii] These remarks reveal the EU’s intention to reshape trade terms in its favor without completely severing ties with China. However, the European Commission’s protectionist measures aimed at safeguarding domestic industry are being met with a much harsher response from China. China’s Ministry of Commerce has characterized the EU’s plan as “disguised protectionism” and a violation of free trade rules. The Beijing administration has officially announced that if Brussels insists on the “Made in Europe” approach, countermeasures directly targeting European companies and imports from Europe will be implemented.[iii] In the event of a potential trade dispute, China is expected to target critical European agricultural and livestock export products such as cognac, pork, and dairy products. This situation not only poses an economic threat but also carries the potential to create political pressure within the domestic politics of EU countries that heavily export these products, particularly France and Spain.
While the EU’s strategic autonomy goals are understandable, it is also necessary to assess certain reservations regarding the economic protectionist methods chosen to achieve these goals and the need to consider global political realities. The success of a large-scale industrial reform like “Made in Europe” requires strong coordination between EU institutions and member states. However, as seen in the example of the Mercosur Agreement, deep disagreements between the European Commission and the Parliament, or internal political tensions in some member states like Hungary and Italy, make it difficult for the EU to present a united front in its foreign trade policy.[iv] Protectionist incentives carry the risk of making European industry dependent on state aid and less efficient compared to global markets, rather than making it more resilient to external shocks to the extent that they restrict competition.
Beyond the threat of Chinese retaliation and internal coordination issues, the “Made in Europe” strategy is forcing industries to source components that are generally more expensive than their Asian counterparts. This situation not only increases production costs for critical goods such as electric vehicles and solar panels but also carries the risk of European companies losing their global competitive edge. Furthermore, unlike Beijing’s centralized financial power or the U.S.’s capacity for capital allocation, the EU relies on the fragmented budgets of its 27 member states. Redirecting financial resources to support less efficient domestic sectors could create industries perpetually dependent on state aid. This, in turn, could further strain the EU’s collective financial capacity and slow down its green transition. For while Europe needs affordable and accessible green technologies to meet its 2050 carbon-neutrality targets, protectionist barriers artificially inflate the cost of these technologies.
Given the current structure of global supply chains, limiting the EU’s trade relations with China through protectionist barriers poses a serious risk in terms of supply security and market access. The assumption that any economic turmoil resulting from potential trade tensions with China could be offset by the United States—a traditional ally—is a matter that requires careful consideration. Trends in U.S. policy, particularly Donald Trump’s “America First” policies that question expenditures such as the Ukraine Security Assistance Initiative (USAI) budget, create uncertainties regarding the continuity of U.S. support. At the same time, while the U.S. protects its own green industry with various subsidies, such as the Inflation Reduction Act, the EU’s “Made in Europe” efforts remain too meager to compete with these massive funds. In this context, the EU risks jeopardizing its position in the Chinese market while facing the danger of becoming increasingly dependent on a U.S. alliance that is growing economically and politically unstable.
Consequently, the EU’s “Made in Europe” initiative is an ambitious step toward securing strategic autonomy in a new era of global trade marked by uncertainty. However, this strategy—which faces explicit threats of retaliation from China—also serves as an indicator of the global shift from free trade toward protectionism. The EU’s attempt to protect its industry through subsidies may fail to generate the desired economic momentum when combined with institutional coordination gaps and the inefficiency of structural reforms. Furthermore, given the difficulty of filling the economic void created by a potential trade contraction with China—especially through allies like the U.S., whose policies have become unpredictable—it can be argued that these steps taken by Europe in the name of autonomy paradoxically risk leaving the continent exposed to new commercial and strategic vulnerabilities.
[i] “EU introduces Made-in-Europe rules to support its industries”, Strategic Perspective, https://strategicperspectives.eu/eu-introduces-made-in-europe-rules-to-support-its-industries/, (Date Accessed: 03.05.2026).
[ii] “Stéphane Séjourné: La Chine reste un partenaire, mais il faut rétablir un équilibre”, France 24, https://www.france24.com/fr/%C3%A9missions/ici-l-europe/20260501-st%C3%A9phane-s%C3%A9journ%C3%A9-la-chine-reste-un-partenaire-mais-il-faut-r%C3%A9tablir-un-%C3%A9quilibre, (Date Accessed: 03.05.2026).
[iii] “La Chine menace l’Union européenne en cas d’adoption d’un plan Made in Europe”, France Info, https://www.franceinfo.fr/monde/europe/union-europeenne/la-chine-menace-l-union-europeenne-en-cas-d-adoption-d-un-plan-made-in-europe_7967270.html, (Date Accessed: 03.05.2026).
[iv] “Mercosur: les coulisses du bras de fer entre la Commission européenne et le Parlement”, L’Express, https://www.lexpress.fr/politique/mercosur-les-coulisses-du-bras-de-fer-entre-la-commission-europeenne-et-le-parlement-52K42GWQO5HM5MC7EFXBOPVR7M/, (Date Accessed: 03.05.2026).
