A giant golden statue depicting a naked Donald Trump has gone on display inside one of the European Parliament's buildings.

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For years, the European Union has struggled with a peculiar contradiction in its dealings with China. The EU is one of the largest and wealthiest trading blocs on earth, capable of determining access to a market of some 450 million relatively affluent consumers, yet it frequently conducts foreign policy as though it were the supplicant.

Hilde Vautmans, the Belgian Renew Europe MEP and European Parliament rapporteur on EU-China political relations, is right to challenge this timidity.

Her report, debated this week in Strasbourg, does not advocate severing relations with Beijing. Nor should it. China is too economically important and too influential on questions ranging from climate change to international security for Europe simply to close the door.

But dialogue must not become an alternative to action.

“Europe has economic power. It’s time to use it,” Vautmans told Parliament ahead of the vote. That sentence ought to be pinned above every desk in the European Commission dealing with China.

The figures make the case brutally clear. In 2025 the EU imported €559.4 billion of goods from China while exporting just €199.6 billion in the opposite direction. The resulting deficit was €359.8 billion — almost €1 billion every day.

As EU Today reported recently, Commission President Ursula von der Leyen has herself warned of a potential “second China shock”, with subsidised Chinese industrial production threatening European manufacturers.

Fine words. But Beijing has heard fine words before.

The Commission’s preferred formulation remains “de-risking, not decoupling”. There is sense in that distinction. Nobody seriously proposes shutting down trade with the world’s second-largest economy. But de-risking becomes meaningless if every risk identified is followed by another dialogue, another working group and another opportunity to postpone difficult decisions.

Indeed, the Commission acknowledges that European companies operating in China face regulatory obstacles, inadequate intellectual-property protection, restrictions on data flows and pressures associated with technology transfer.

Europe possesses formidable weapons with which to respond: anti-dumping duties, anti-subsidy measures, foreign-investment screening, the Foreign Subsidies Regulation, the Anti-Coercion Instrument, procurement restrictions and controls on strategically sensitive technologies.

These instruments should not be deployed indiscriminately. But neither should they sit polished in the armoury while Beijing exploits European openness.

Vautmans is particularly right to connect economics with security and values. China cannot reasonably expect privileged access to European markets while helping sustain the Russian war machine. The European Parliament’s own research service describes Beijing as a “decisive enabler and dual-use provider”, including through goods entering Russian weapons and drone supply chains.

If Chinese companies materially assist Russia’s ability to wage war against Ukraine, Europe should be prepared to impose a direct economic price. The same principle should apply to human rights.

EU Today has warned repeatedly that Brussels’ ritualised engagement with Beijing risks becoming precisely that: ritual.

We reported earlier that the EU-China Human Rights Dialogue risks losing credibility, pointing to the continuing imprisonment of Swedish citizen Gui Minhai and Uyghur academic and Sakharov Prize laureate Ilham Tohti. After round upon round of discussions, Beijing has learnt that European expressions of “deep concern” are inexpensive things to endure.

The problem is hardly new. Years ago, EU Today highlighted calls for concrete EU action over goods associated with forced labour in China, including demands for tougher restrictions on entities implicated in abuses against Uyghurs.

Yet repression continues. In March this year China adopted its new Law on the Promotion of Ethnic Unity and Progress. The European Parliament subsequently condemned what it described as intensified repression and assimilation affecting Tibetans, Uyghurs and other minorities, by the overwhelming margin of 439 votes to 52.

Europe therefore faces a straightforward question. What is the purpose of economic power if it is never translated into political influence?

The EU should not attempt to bully China. Nor should it abandon diplomacy. Vautmans is correct that channels of communication must remain open. But reciprocity must become something more than a word appearing in communiqués.

Where China closes markets to European companies, Europe should be prepared to restrict equivalent access. Where state subsidies distort competition, Brussels should respond rapidly with trade-defence measures. Where strategic dependencies expose Europe to political coercion, alternative supply chains must be built. Where Chinese entities support Russia’s military-industrial complex, sanctions should follow. And where companies benefit from forced labour or serious human-rights abuses, access to the European marketplace should carry consequences.

That is not protectionism. It is leverage.

Totalitarian states understand leverage perfectly well. China routinely uses access to its enormous market as an instrument of statecraft. Europe, by contrast, too often behaves as though exploiting its own commercial strength would somehow represent a failure of diplomacy. It represents precisely the opposite.

The European Commission has spent years discovering that China is simultaneously a partner, competitor and “systemic rival”. It is time to move beyond discovering the obvious.

Vautmans has identified the essential point. Europe already possesses economic power on a scale few countries can ignore. What it appears to lack is the political confidence to use it.

Main Image: by Valentine ZELER, © European Union 2026 – Source : EP

MEPs have opened debate on the EU’s proposed Affordable Housing Act, which would give national and local authorities a clearer legal framework for restricting short-term rentals and some non-primary residential property use in areas facing severe housing pressure.

The European Parliament has begun examining legislation that would give cities and national governments greater legal certainty when restricting short-term rentals and the use or acquisition of residential property in areas where housing has become difficult to afford.

The proposed Affordable Housing Act, presented by the European Commission on 9 September, was on Parliament’s agenda in Strasbourg on Tuesday as housing costs move further into EU-level politics.

The legislation does not transfer general housing policy to Brussels. Decisions on construction, planning, rent policy and social housing would remain primarily with national, regional and local authorities.

Instead, the proposal would establish a common EU legal framework governing some restrictions that member states and cities may introduce when attempting to protect housing supply.

The draft regulation specifically covers measures restricting short-term accommodation in residential properties other than a host’s primary residence. It would also cover restrictions on the acquisition or use of land and housing that is not intended as somebody’s principal home.

Those provisions are designed partly to resolve a legal problem that has become increasingly important in cities with large tourism markets.

Local governments have introduced restrictions on holiday rentals and second-home use, but such measures can clash with EU single-market rules governing services, property and establishment. The Commission says the legislation would provide authorities with a clearer method for demonstrating when restrictions are justified and proportionate.

The law would therefore not impose a common European cap on Airbnb-type accommodation. Nor would it oblige cities to introduce restrictions.

Authorities choosing to intervene would instead have to demonstrate housing stress and ensure that their measures meet EU requirements on proportionality, transparency and review.

Brussels argues that the scale of Europe’s housing problem now affects more than social policy.

According to the Commission’s European affordable housing plan, house prices across the EU have risen by more than 60 per cent since 2013, while average rents have increased by about 20 per cent. Short-term rentals increased by 93 per cent between 2018 and 2024.

Only between six and seven per cent of EU housing stock is classified as social housing, while about 20 per cent of homes are recorded as unoccupied.

The Commission estimates that Europe needs to build more than two million homes a year to meet current demand — around 650,000 more annually than are presently being constructed. It estimates the additional investment requirement at approximately €153 billion each year.

Those figures underline a central difficulty in the housing debate: restrictions on tourist accommodation may return some properties to residential use, but they do not address the full shortage of new homes.

EU Today examined that wider supply issue when the Commission launched its European Affordable Housing Plan, which combines proposed regulation with investment, faster permitting, construction reform and changes to state-aid rules.

The debate is becoming more politically prominent as housing affordability affects a growing share of middle-income households as well as those on lower incomes.

Berlin offers one example. EU Today reported last month that advertised rents in the German capital had risen by roughly three-quarters in less than a decade, while the city calculates that it will need another 211,000 homes by 2040.

Pressure is particularly acute in large cities and tourism centres, where residential demand competes with short-term accommodation and investment properties.

The Commission argues that this has consequences for the wider economy because workers who cannot find affordable accommodation may be unable to move to areas where jobs are available.

That is why Brussels increasingly presents housing not only as a social concern but as part of the competitiveness and single-market agenda.

The proposal is still at an early stage. Parliament and the Council must negotiate the legislation under the ordinary legislative procedure, and substantial amendments remain possible.

Questions are likely to centre on how “housing stress” is defined, what evidence authorities must provide before restricting property use and how far EU law should permit local intervention in property markets.

The political dividing line is already apparent. One side of the debate stresses that cities need more freedom to protect permanent housing stock. The other warns that regulation of short-term rentals or second properties can affect tourism businesses, property owners and investment without necessarily creating sufficient new supply.

The Affordable Housing Act attempts to establish legal rules for that dispute rather than settle it centrally.

If adopted, its importance will therefore depend less on a single Brussels policy than on how individual European cities use the powers and legal protection it provides.