【By Observer Net, Qi Qian】

On February 9th local time, a French government advisory body released a report warning that European industry is being crushed by China's "giant ship."

The report stirs up the "Chinese industrial threat," stating that European industry is facing a "crisis of survival." The report calls on the EU to "take real action" in response: considering imposing a comprehensive 30% tariff on Chinese goods, or devaluing the euro against the yuan by 30%, to counter the impact of Chinese imports.

French media BFM TV called the proposal "shocking." The French newspaper Les Échos also stated that it was an "aggressive plan," and the report explicitly mentioned the Plaza Accord signed by the United States to pressure Japan over trade deficits 41 years ago.

"European Industry Is Being Crushed by China"

According to the introduction, this report was compiled by the French government's advisory body, the High Commission for Strategy and Planning (Haut-Commissariat à la Stratégie et au Plan). This agency reports directly to the Prime Minister of France and guides long-term public policy.

The report states that China's industrial rise has no longer been limited to a specific industry in just a few years, but rather poses an unprecedented so-called "systemic threat" to European production bases. Traditional pillars of European industry such as automobiles, batteries, industrial equipment, and chemicals are facing "direct attacks."

Proportion change of China-EU in global manufacturing output - Report screenshot

Since the 2010s, China has adjusted its industrial policies, shifted to high-end markets, and now occupies a position in high-value-added fields (electric vehicles, batteries, machine tools, pharmaceuticals, robotics). Currently, China accounts for nearly one-third of global manufacturing output, while the EU accounts for about 15%, and China's manufacturing trade surplus has reached an all-time high.

"The competition from China is threatening the core of European production," said the head of the institution, Clément Beaune, in the report. "The report shows that we are not facing an industrial shock, but a systemic dynamic, which requires profound changes at the European level."

Analysis found that European industry is facing challenges in both export and domestic markets. Especially in the EU market, as much as 55% of manufacturing output may face competition from China. At the same time, the risks faced by different countries vary significantly: Germany is as high as 70%, Italy around 60%, Spain around 50%, and France around 36%.

The report specifically mentioned the automotive industry. Data shows that China currently accounts for nearly 40% of global passenger car production, and within a few years has established itself as a leading export country, especially in the electric vehicle sector. On the contrary, Europe's automotive trade surplus, especially Germany's, is rapidly narrowing. Over 13 million direct and indirect jobs in the European automotive industry are at risk.

The report attributes the competitive advantage of Chinese products simply to a "huge and irreversible" cost difference. According to manufacturers' estimates, the cost difference between China and Europe is between 30% and 40%, and can be even larger depending on the industry.

The report emphasized that lower energy and land costs, relatively relaxed social and environmental frameworks, high investment levels, fierce domestic competition, rapid technological upgrades, and economies of scale related to highly integrated value chains collectively form a coordinated industrial system, giving Chinese enterprises a lasting competitive advantage, which European industries find difficult to replicate in the short term.

France Attempts to Replicate the Plaza Accord

Therefore, the report recommends that the EU needs to undergo a profound paradigm shift, focusing on two main schemes to eliminate the competitiveness gap between China and Europe: imposing a general 30% tariff on Chinese goods, or depreciating the euro against the yuan by 20% to 30%.

The report states that protective measures are crucial, but must be incorporated into a broader European productivity agenda, including strategies aimed at increasing innovation and investment.

Report screenshot

French media noted that the second scheme was inspired by the 1985 Plaza Accord.

At that time, to resolve the U.S. trade deficit, under the planning of the U.S. government, in September 1985, finance ministers and central bank officials from five countries, the U.S., Japan, the UK, France, and Germany, met at the Plaza Hotel in New York for the "Plaza Meeting." They reached an agreement on coordinating monetary policies and orderly depreciation of the dollar against major currencies. Most scholars believe that this was the main cause of Japan's prolonged economic downturn later.

Beaune admitted that manipulating the euro to depreciate or the yuan to appreciate would be more difficult than imposing tariffs. BFM TV also said that this move seems hard to implement, especially because Europe would need to coordinate with the U.S. and China on this issue.

However, imposing tariffs is also far from simple, requiring the qualified majority support of EU member states. This requires persuading other European countries, first and foremost Germany. The German government had previously opposed imposing tariffs on Chinese electric vehicles.

"This is not a matter that can reach consensus at the European level," Beaune lamented.

Has the Macron Government Been Planning This for a Long Time?

Les Échos mentioned that regardless, this is a potential goal during France's presidency of the G7. French Finance Minister Roland Lescure said last week that if necessary, he might include currency market fluctuations in the agenda of this year's G7 meeting.

Macron's January 2026 Ambassador Conference, Forcedly Bringing Up China - Screenshot of the Post

Lately, EU leaders have frequently raised the issue of the China-EU trade deficit, urging China to increase investments in Europe.

French President Macron has repeatedly called for Chinese investment in Europe, exaggerating the "China-Europe trade imbalance," and even threatening to use so-called protectionist measures. In January this year, Macron claimed in a speech that China "is still a rising power, diversifying its partnerships, but showing increasingly reckless commercial aggression." He even accused China of "damaging the European economy."

Regarding these issues, He Yadan, spokesperson for the Ministry of Commerce, responded to a journalist's question in December last year, stating that China noticed that the EU has been increasing its restrictions on China's trade and economy since 2025, launching 12 trade remedy investigations and three foreign subsidy investigations against China, and blocking several Chinese companies from participating in public procurement and greenfield investments in EU member states.

Guo Jiakun, spokesperson for the Foreign Ministry, reiterated in January that the essence of Sino-European economic and trade relations is complementary strengths and mutual benefit. The competitive advantage of Chinese products does not come from subsidies, but from the combined effects of substantial R&D investment, full market competition, and complete industrial chains. China does not deliberately pursue a trade surplus, and not only wishes to be "the world's factory," but also wants to be "the world's market."

Guo Jiakun stated that he hopes the EU will take a long-term perspective and an open mindset, work in tandem with China, and promote the continuous healthy development of Sino-European economic and trade relations. The Chinese government has always encouraged and supported capable and willing Chinese enterprises to invest and develop in Europe according to market principles, and hopes that the EU will create a fair, non-discriminatory, transparent, and predictable market environment for Chinese enterprises.

This article is exclusive to Observer Net. Without permission, it cannot be reprinted.

Original: toutiao.com/article/7605042695295205930/

Statement: The article represents the views of the author alone.