Key facts
- EU trade chief Maroš Šefčovič will meet with European CEOs on September 18.
- The meeting's purpose is to discuss diversifying critical supply chains away from China.
- The European Commission is considering a "diversification tool" to encourage sourcing from multiple suppliers.
- Industry buy-in is sought before formally proposing the diversification measure.
- CEOs from the machinery, auto, electronics, and chemicals industries are expected to attend.
EU trade chief Maroš Šefčovič is scheduled to convene with top European business leaders on September 18 to solicit their input on the European Commission's strategy to reduce reliance on China for critical supply chains. The Commission is exploring a "diversification tool" designed to incentivize companies to source essential imports, such as raw materials, from a minimum of three alternative suppliers when feasible.
This initiative aims to secure industry support and gauge the extent to which businesses are prepared to lessen their dependence on China, acknowledging the associated costs. The meeting occurs amid increased dialogue between Brussels and Beijing over the summer, as the EU seeks to narrow its substantial trade deficit with China. It follows technical discussions with Chinese officials and precedes Šefčovič's planned visit to Beijing in early October.
Šefčovič has indicated that business leaders themselves are increasingly recognizing that the cost of diversification is less significant than the potential cost of supply chain disruptions. He is inviting key stakeholders to a special forum to help shape the Commission's thinking on the optimal design of such an instrument, ensuring buy-in from leading companies.