EU seeks trade balance with China as heat wave drives air conditioner imports
12 reported
The European Union and China have agreed to work toward balancing trade by October, but a historic heat wave is driving unprecedented demand for Chinese-made air conditioners, highlighting the difficulty of addressing the trade imbalance. European trade chief Maros Sefcovic and China’s Commerce Minister Wang Wentao issued a rare joint statement on Monday, agreeing to set up a bilateral working group to monitor trade flows. Sefcovic said Chinese exports to the EU keep rising while EU market share in China shrinks, calling the trend “not sustainable.” The EU’s goods deficit with China grew 15% to €360 billion last year, with all 27 member states experiencing a shortfall, and expanded to €98 billion in the first quarter. Midea Group reported orders for its PortaSplit air conditioner unit have topped 200,000 this year, double 2025’s pace. None of Europe’s five best-selling air-conditioner brands is owned in the EU, with Chinese companies holding about 32% of the European market by retail volume in 2025. Analysts expressed skepticism that China has made real commitments in trade talks, with one noting “no sign of policy action forceful enough to materially reduce the trade surplus with Europe.”
What’s reported
The EU and China released a joint statement on Monday aimed at balancing trade and addressing market access issues.
European trade chief Maros Sefcovic said disputes over trade imbalances, export controls and intellectual property must deliver “tangible results” by October.
The two sides agreed to set up a bilateral working group to monitor trade flows.
Beijing made clear it would retaliate against any new trade curbs designed to tackle overcapacity.
The EU’s goods deficit with China grew 15% to €360 billion last year, with all 27 member states experiencing a shortfall.
The deficit expanded to €98 billion in the first quarter, the highest since 2022.
Midea Group reported orders for its PortaSplit unit have topped 200,000 this year as of Monday, double 2025’s pace.
None of Europe’s five best-selling air-conditioner brands is owned in the EU.
Chinese companies Haier, Gree Electric, and Midea together hold about 32% of the European market by retail volume in 2025.
Air-conditioning ownership in Europe stands at around 20% of households, compared to nearly 90% in the U.S., according to the International Energy Agency.
The European Commission said after talks that “the status quo is not an option.”
The bloc has recently restricted funding to solar projects using Chinese-made components and ended a tax exemption for low-value parcels used by companies like Temu and Shein.
Key figures
Maros Sefcovic, European trade chief
Wang Wentao, China’s Commerce Minister
Gabriel Wildau, managing director at consultancy Teneo
Adrian Kübel, German software developer
Denis Depoux, global managing director at Roland Berger
Alicia García Herrero, chief economist at French investment bank Natixis
Andrew Small, director at the European Council on Foreign Relations
Sources: CNBC
