Brussels is pushing to narrow its record trade deficit with China by October, but a historic heat wave is complicating that ambition in the most visible way possible.
The European Union and China released a joint statement on Monday aimed at rebalancing trade flows and addressing longstanding market access disputes between the two economies.
European trade chief Maros Sefcovic met with China’s Commerce Minister Wang Wentao in Brussels, demanding that disputes over trade imbalances, export controls and intellectual property deliver “tangible results” by October.
“Not 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,” Sefcovic told reporters after the meeting.
He noted that Chinese exports to the EU “keep rising, while our market share in China keeps shrinking,” describing the trend as “not sustainable” and warning that structural change is urgently needed.
The bloc’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 of 2026, the highest since 2022.
Adding to that deficit this summer is a surge in Chinese-made air conditioners, as Europe endures its worst-ever heat wave and consumers rush to buy cooling equipment that the continent has historically avoided.
Midea Group reportedly said orders for its PortaSplit unit have topped 200,000 this year as of Monday, double the pace seen in 2025, underscoring the scale of European demand for Chinese cooling technology.
Air-conditioning ownership in Europe stands at around 20% of households, far below the nearly 90% penetration rate in the United States, according to the International Energy Agency, a gap Asian manufacturers are racing to close.
None of Europe’s five best-selling air-conditioner brands is EU-owned, with Chinese companies Haier Group, Gree Electric Appliances and Midea Group together holding around 32% of the European market by retail volume in 2025, according to Euromonitor International.
Midea’s PortaSplit has been engineered specifically to navigate Europe’s fragmented regulatory landscape, with its outdoor unit clipping onto a window bracket without drilling and classified as furniture rather than a fixture to sidestep facade-modification bans in cities like Paris.
The refrigerant charge is capped at 1.99 kilograms, just under France’s 2-kilogram regulatory limit, illustrating the precision with which Chinese manufacturers are targeting European consumers.
Gabriel Wildau, managing director at consultancy Teneo, said “the sense of urgency over [China’s] threat to European industry appears to have reached a tipping point,” while noting that China’s leadership has shown “little appetite for placating Europe.”
“There is no sign of policy action forceful enough to materially reduce the trade surplus with Europe,” Wildau added, casting doubt on the durability of any commitments made in Monday’s joint statement.
Alicia GarcÃa Herrero, chief economist at French investment bank Natixis, went further, calling the progress simply “smoke” from China to deter Europe from launching more protectionist measures, noting that “China has made no real commitment in setting an actual [import] quota or actual implementation mechanism.”
Denis Depoux, global managing director at Roland Berger, warned that half of the EU’s imports from China are now technology products and said the shift “is an inversion of the past decades and is scary for European industries, and can be a financial systemic problem for the Union.”
Andrew Small, director at the European Council on Foreign Relations, said any European measures would be “targeted in areas where either Chinese competition risks causing serious harm to critical industrial sectors, or where there is a major dependency risk that China may weaponize,” adding that “there is no discussion about across-the-board tariffs.”
Depoux closed with a note of cautious optimism, arguing that “‘delayed reciprocity’ is the concept that should be at play here,” suggesting Chinese and European firms could eventually merge to compete globally rather than clash over market share.