Economics

Aug 21, 2026 Desmond Lachman

While economic rebalancing by China would be good for everyone, Chinese leaders have given little indication that they are moving decisively in this direction. With China's ever-increasing exports threatening to decimate European manufacturing, the EU has little choice but to embrace tariffs.

WASHINGTON, DC—Few could have predicted the consequences China’s 2001 accession to the World Trade Organization would have for the United States. By contributing to the hollowing out of the US manufacturing sector and the decline in US manufacturing employment, China’s integration into the global economy helped prepare the ground for the right-wing economic populism that propelled Donald Trump’s political rise. Unless Europe acts soon to protect its manufacturing sector from surging Chinese imports, it may face a similar fate.