China Threatens Retaliation Over EU’s New Overcapacity Tool (euobserver.com)

• China warns of "resolute countermeasures" if EU implements overcapacity instrument
• EU tool targets Chinese state-subsidized exports in steel, aluminum, solar, and others
• China cites WTO violations and threatens equivalent retaliation

"The European Union is finalizing a new trade instrument targeting Chinese industrial overcapacity, prompting Beijing to warn of "resolute countermeasures" if implemented. The tool aims to curb exports from China’s state-subsidized sectors, including steel, aluminum, and solar panels. China’s Ministry of Commerce stated that such measures violate WTO rules and will be met with equivalent retaliation. The escalation comes amid ongoing tensions over EU anti-subsidy investigations and carbon border adjustments. The exact scope remains under negotiation, but analysts expect it to cover multiple industries. The standoff risks further dividing the global economy into competing blocs."