In early November, the Chinese fast fashion giant Shein opened its first European store in the heart of downtown Paris. The reaction was, to put in mildly, mixed: bargain-hunters flocked to the store but riot police had to physically remove protesters for setting off a stink bomb. The contrast between enthusiastic shoppers, stink bomb-wielding activists, and a mostly indifferent public is an apt symbol for Europe’s confused response to China’s rise, which vacillates between courtship, benign indifference, and deep suspicion.
Anti-China sentiment recalls earlier anxieties about American commercial and industrial might, anxieties that long preceded the United States’ actual involvement in continental affairs. The nationalists, anti-semites, and traditionalists who relentlessly persecuted Alfred Dreyfuss, a French artillery captain falsely convicted of spying for the Germans in 1894, often indulged in broader conspiratorial fantasies with ‘Oncle Sam’, the personification of American capitalism, at the center of the web. Similar anxieties would periodically recur in French politics: Poujadism, a populist movement of smallholders and tradesmen in the 1950s, was preoccupied with American economic encroachment, and the anti-globalization protesters of the 1990s identified McDonalds and Eurodisney as two of their most prominent targets.
These anxieties were leading, and not lagging, indicators of the United States’ growing influence on the world stage. Even before World War Two and the creation of a post-war Western alliance centered on Washington, the influence of American products, ideas, and cultural exports was felt across the continent. Despite the tendency of many Europeans to ignore or downplay Beijing’s reach, the same can be said of China’s growing economic footprint today.
Indeed, developments that at first glance have little to do with China’s rise reflect this underlying reality. The Trump Administration’s recently released National Security Strategy provoked an uproar in Western capitals for its forthright criticism of the European Union, but the newly-announced doctrine of “flexible realism” is not a product of tensions on the continent. Instead, the United States is shifting resources to the Western Hemisphere and the Pacific in response to a potential clash with China. From the war in Ukraine to forward-deployed NATO military missions in the Baltics, European countries cannot afford to ignore this shift in American military and diplomatic resources.
For years, skeptics argued that China’s rise held little importance for global culture, geopolitics, or high tech industries. Even today, there is a persistent tendency in Europe to see China as a source of cheap and easily disposable consumer trinkets, personified by the fast fashion giant Shein, the online marketplace Temu, and the recent craze for cheap Labubu dolls. In Hungary, corner stores that sell cell phone cases, headphones, and inexpensive home goods often have “Kinai” or “Hong Kong” in their names.
Yet more telling signs of Chinese influence are readily apparent. For over a year, protests have rocked Serbia over a deadly roof collapse at a train station in Novi Sad. The contractor behind the project was Chinese, an unsurprising fact given China’s growing portfolio of infrastructure projects on Europe’s periphery. There is a temptation to dismiss the Novi Sad accident as a typical case of shoddy Chinese workmanship, but more impressive (and consequential) Chinese projects are easy to find across the Balkans, such as a newly-built bay bridge linking Southeastern Croatia to the rest of the country.
Elsewhere, China’s investment patterns have shifted from relatively straightforward infrastructure projects to high tech endeavours, such as the automotive and battery plants that have recently opened in Poland and Hungary. The European growth of Temu, an Amazon–like retail platform, also reflects China’s growing technological and commercial weight. For years, various European countries have tried and failed to incubate their own home-grown versions of Silicon Valley. China, meanwhile, has built its tech sector from the ground up; retail websites like Temu and social media giants like Tik Tok rival American tech companies in global reach and popularity.
Ironically, China’s investments in Central and Eastern Europe fill a void left by Western Europe’s recent turn against manufacturing and heavy industry. After the end of the Cold War, Western European companies, especially German ones, rushed open plants and factories in the former Eastern Bloc, attracted by the region’s educated workforce, cheaper wages, and geographic proximity. A network of plants from the likes of Bosch, Audi, and BMW sprung up across Poland, Czechia, Slovakia, and Hungary, fueling the region’s economic transformation and the broader project of European integration.
Western Europe’s interest in such projects has waned in recent years as old industries have declined and ambitious environmental targets have discouraged investment in heavy industry. Chinese companies are rushing to fill the vacuum. A map of continental manufacturing would show that the old industrial regions of Northwest Europe, Southern Germany, and Northern Italy have been supplemented (or in some cases replaced) by new hubs further to the East. A generation ago, this shift was driven by Western companies investing in newly opened Eastern economies. Today, it’s Chinese companies that are investing in Europe’s periphery. According to Reuters, there are now 33 Chinese companies selling cars in Poland, most of them of the old school, gas powered variety.
After years of ignoring China’s rise or naively assuming that Europe would benefit from the emergence of a technology advanced and economically aggressive competitor, a few policymakers have started throwing proverbial stink bombs. EU leaders may decry Trump’s tariffs, but industrial policy is a familiar tool in European capitals, and a potential onslaught of Chinese electric vehicles has prompted a protectionist backlash that would make the architects of Smoot-Hawley blush. Unfortunately, a lack of foresight and strategic planning continues to hamper Europe’s response to China’s economic rise. The case of Dutch chipmaker Nexperia, a subsidiary of a much larger Chinese conglomerate, is a case in point. The Netherlands is the last bastion of advanced semiconductor manufacturing in Europe. After years of reported intellectual property theft, Nexperia was finally placed under government control to forestall more illicit tech transfers. That decision is currently being challenged in court by Nexperia’s Chinese parent corporation.
Indeed, one question Europe will have to answer in the coming decades is how to sustain key industries in a world increasingly dominated by Chinese competitors. For decades, China was a key export market for the German car industry, with brands like Mercedes and BMW benefiting from the status associated with owning a European luxury car. Today, China is basically self-sufficient in car production and enjoys a marked advantage over its European competitors in new technologies such as electric batteries and self-driving systems. At the other end of the automotive spectrum, Chinese gas guzzlers are usually cheaper than their European counterparts. So who will be left to buy European products?
A recent assessment from The Financial Times’ Robin Harding should worry anyone invested in the future of European industry. When asked what products might interest China in a world where European technology and industrial expertise is no longer in demand, the best Harding’s Chinese interlocutors could come up with were Louis Vuitton handbags and slots at European universities. This brings to mind the Qianlong Emperor’s dismissive reply to a British trade embassy in 1793, when he declared, “our Celestial Empire possesses all things in prolific abundance and lacks no product within its own borders.” In the late 18th century, this was an empty boast. In the 21st century, China’s claims to self sufficiency, at least with respect to European exports, have belatedly come true.
Europe’s muddled response to China’s growing economic influence is coupled with a foreign policy that combines military impotence with half-hearted attempts to assert the continent’s old imperial prerogatives. After a long (and expensive) tour of the Pacific, Great Britain’s sole remaining aircraft carrier has just returned to home port for a refit. This follows a similar tour by the French carrier Charles de Gaulle in 2024 and 2025. In security terms, Europe’s most pressing threats are a revanchist Russia and the need to sustain military and economic aid to Ukraine, especially if the United States decides to further reduce its military presence in Central and Eastern Europe. Yet considerable resources are still devoted to glorified public relations exercises on the other side of the world.
French and British warship deployments in the Pacific usually involve cooperative exercises with the US Navy, which suggests that European countries would provide direct military assistance in the event of a US-China clash over Taiwan. This is a questionable assumption. Given Europe’s well-documented difficulties supplying Ukraine with weapons and military equipment, it’s not clear what tangible assistance France or Britain could offer the United States in a Pacific war. Then there is the question of Europe’s appetite for a direct confrontation with China. Even after Russia annexed Crimea in 2014, Germany and France went to considerable lengths to maintain political and economic links with Moscow. The war in Ukraine has belatedly forced European capitals to reinvest in their militaries and defense industries, but a cautious, conflict avoidant approach to foreign policy is likely to endure, especially in distant geopolitical theaters.
How should Europe approach China in the middle decades of the 21st century? The good news is that European countries still have considerable wealth, industrial infrastructure, and technical expertise to draw on and, unlike the United States, have no military stake in a conflict over Taiwan. A two-pronged strategy that focuses on sustaining European industries and streamlining European military commitments would do much to correct the strategic mistakes of the past few decades. Protectionism is a dangerous tool that invites cronyism, corruption, and political favoritism, but in a world where China and the United States are hardening their own domestic markets, it would be foolish for Europe to unilaterally disarm. It is equally perverse for well-established European companies to cede market share to Chinese newcomers in Eastern Europe, Turkey, and other export markets in their proverbial backyard.
Meanwhile, European countries should reassess their defense commitments in light of Russian aggression and the United States’ pivot to Asia. One needn’t be a proponent of a US-Europe “divorce” to recognize that the Western alliance would benefit from a clearer division of labor. European allies should give up their pretensions to military influence in the Pacific. Carrier deployments on the other side of the world tax British and French military resources and have little relevance to more pressing security challenges at home, such as keeping Ukraine in the fight or protecting key sealanes. French and British carriers should not patrol the Pacific while the US Navy shoulders the burden of responding to Houthi attacks on Red Sea shipping, a vital lifeline for European trade.
After years of confusion, European capitals are belatedly waking up to the reality of Chinese economic power. A country that was once viewed as a limitless export market for European products has transformed into a formidable global competitor. Alarmists and some Chinese policymakers dismiss Europe as a dying continent, a geopolitical player long past its athletic prime. In truth, Europe still has considerable resources at its disposal, but it must marshall those resources if it hopes to survive a Chinese century.
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