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PARIS, FRANCE \u2013 JUNE 24: Pedestrians use umbrellas to shield from the sun as record-breaking high temperatures continue in Paris on June 24, 2026 in Paris, France. <\/p>\n
Li Yang | China News Service | Getty Images<\/p>\n<\/div>\n<\/div>\n<\/div>\n
Europe wants to narrow its record trade deficit with China by October, but the bloc\u2019s worst-ever heat wave is driving unprecedented demand for imports of Chinese-made air conditioners, a telling tale illustrating how hard it will be for Brussels to address the trade imbalance.<\/p>\n
The European Union and China released a rare joint statement<\/a> on Monday aimed at balancing trade between the two economies and addressing market access issues. <\/p>\n Disputes over trade imbalances, export controls and intellectual property must deliver \u201ctangible results\u201d by October, European trade chief Maros Sefcovic told reporters after meeting with China\u2019s Commerce Minister Wang Wentao. The two sides agreed to set up a bilateral working group<\/a> to monitor trade flows, with \u201creassurance\u201d from Beijing that existing export controls on rare earths and permanent magnets will not disrupt EU supply chains. <\/p>\n \u201cNot everything will be solved, not everything will be fixed, but we think that between now and October, our teams have sufficient time to deliver the tangible results,\u201d Sefcovic said. Chinese exports to the EU \u201ckeep rising, while our market share in China keeps shrinking,\u201d he said, calling the trend \u201cnot sustainable.\u201d <\/p>\n Beijing has made it clear that it would not hesitate to retaliate against any new trade curbs<\/a> designed to tackle the overcapacity issue.<\/p>\n But the timing is awkward. The pair met in Brussels just as an historic heat wave<\/a> has Europeans rushing to buy air conditioners \u2014 mostly made in China. Europe has long resisted air conditioning as noisy, an eyesore on architectural facades and unnecessary, as brutal summer heat has been relatively short-lived. It also fears widespread adoption of the energy-hungry technology risks undermining the fight against climate change. <\/p>\n The bloc\u2019s goods deficit with China<\/a> grew 15% to \u20ac360 billion ($410 billion) last year, with all 27 member states experiencing a shortfall, and expanded to \u20ac98 billion in the first quarter, the highest since 2022. Electrical equipment and machines are among the most imported goods. <\/p>\n \u201cThe sense of urgency over [China\u2019s] threat to European industry appears to have reached a tipping point,\u201d said Gabriel Wildau, managing director at consultancy Teneo, while China\u2019s leadership has shown \u201clittle appetite for placating Europe.\u201d <\/p>\n \u201cThere is no sign of policy action forceful enough to materially reduce the trade surplus with Europe,\u201d Wildau noted. <\/p>\n<\/div>\n Air conditioners are adding to that imbalance this summer. <\/p>\nA big market to fill<\/h2>\n