Analysts at the Brookings Institution said Europe's model of globalization is ending as China redirects excess manufacturing capacity to the continent [1].
This shift threatens the stability of the European industrial base. If the continent cannot protect its domestic production from a flood of subsidized imports, it risks a long-term loss of technical expertise and economic autonomy.
A panel featuring Ryan Hass, Jon Czin, Constanze Stelzenmüller, and Kari Heerman discussed how China is seeking new markets for its surplus exports [1]. According to the panel, China is channeling this overcapacity into Europe, which erodes the continent's own industrial capacity [1].
This perspective aligns with views from some EU officials who said that the war in Ukraine has further demonstrated the limits of globalization as previously understood [2]. The combination of geopolitical instability and aggressive trade practices has forced a reconsideration of how Europe engages with global supply chains.
However, this conclusion is not universal. Some analysts, including those from The Globe and Mail, said that globalization remains a long-standing system [2]. From this perspective, the pandemic and recent geopolitical shocks exposed the risks of the system rather than ending the system itself [2].
The Brookings panel said that the current trend is more than a temporary disruption. They said that the structural nature of China's manufacturing surplus creates a permanent pressure on European firms that cannot be resolved through traditional trade agreements [1].
“Europe’s model of globalization is ending as China redirects excess manufacturing capacity to the continent”
The debate highlights a fundamental tension between the 'efficiency' of global trade and the 'security' of national industrial bases. If Europe transitions from a globalization model to one of 'de-risking' or protectionism, it may stabilize its internal industries but could face higher consumer prices and strained diplomatic relations with China.
