EU Trade Commissioner, Maroš Šefčovič is expected to meet European CEOs on 18 September to take industry feedback on the European Commission’s push to diversify critical supply chains away from China. Executives from the machinery, electrical components, automotive and chemical sectors are expected to attend.
The meeting follows the Commission’s previously proposed idea of a “diversification tool,” where companies would be encouraged to source critical imports, such as raw materials, from at least three different suppliers where alternatives are available.
However, DG TRADE has now confirmed that it is currently developing a future trade diversification instrument, known internally as the “Economic Security Package.” The tool is expected to take shape in Q4 2026/ Q1 2027. Despite being framed around diversification, the focus will be on overcapacity, applying only to strategic sectors and critical industries. The package is expected to compromise of a Regulation and a Communication. However, specifics are expected to be developed following the US-China summit on 24 September.
This diversification drive is extending beyond China policy. Following the theme of diversification, the EU is seeking to deepen its partnership with Canada as Canada faces an escalating trade dispute with the United States. EU government have broadly supported closer cooperation, including countries traditionally cautious about challenging the Trump administration. Technology, research and innovation, trade, critical raw materials, and reduced trade barriers are all flagged as priority areas. Canadian Prime Minister Mark Carney will address the European Parliament during a visit intended to signal stronger EU-Canada ties and reduce dependence on the US. The address, occurring on 17 September, one day after European Commission President Ursula von der Leyen’s State of the Union address, is a clear signal to the world of an intended closer partnership.
These developments taken together point to an EU trade strategy that is increasingly defined by diversification. With the US-China summit and Prime Minister Carney’s visit to Strasbourg both occurring within weeks of each other, late September may be a pivotal moment for the EU’s economic security agenda.
