Former British Prime Minister Rishi Sunak has warned that “Made in China” products pose a threat to Europe’s economy and political landscape, potentially fueling populist unrest. He argues that nations must form an alliance—leveraging their collective strength and scale—to reduce their dependence on China and compel the country to alter its behavior.
Sunak points out that China’s vision for the world is one in which “everyone depends on China, while China depends on no one.” The recent friction between the UK and the European Union over Chinese electric vehicles (EVs) is merely one manifestation of this Chinese “dependency strategy.”
Sunak, who possesses a strong background in finance and economics, served as Prime Minister from October 2022 to July 2024. He remains a Conservative Member of Parliament and currently writes a weekend column for The Sunday Times.
In a recent column, he addressed the issue of Chinese electric vehicles. The UK has sought to participate in the EU’s “Made in Europe” initiative—a framework designed to revitalize European industry and enhance supply chain autonomy—but has faced persistent pressure from some EU member states to align with the bloc’s imposition of additional tariffs on Chinese EVs.
As of 2024, the EU has imposed import tariffs on Chinese electric vehicles, with rates reaching as high as over 45%, and has recently introduced “import quota” measures. In contrast, the UK maintains a baseline tariff rate of 10% on Chinese electric vehicles.
The market share of Chinese-branded vehicles—primarily electric and hybrid models—has been steadily climbing in the UK, reaching nearly 25% for the month of September alone. Meanwhile, despite the EU’s aggressive use of high tariffs, sales of Chinese electric vehicles across the European continent have continued to rise.
Sunak notes that China’s trade surplus in goods reached a record high last year, approaching $1.2 trillion. While China was once a major export market for European firms—particularly for Germany—it is now importing less from Europe while simultaneously increasing its exports to the region. Statistics show that China’s share of global manufacturing output has grown rapidly, now approaching 30%—a figure that exceeds the combined total of the United States, Japan, and Germany.
Sunak cites the example of Volkswagen, which dominated the Chinese automotive market for over 25 years before being unseated from the top sales spot in 2023 by the Chinese brand BYD. By 2025, Volkswagen had slipped further, falling from second to third place—surpassed by another Chinese brand, Geely.
Between 2022 and 2025, the value of German automotive exports to China plummeted by more than 50%. Yet, the automotive sector is just one of several German industries experiencing a broad decline in exports to China.
Meanwhile, China’s exports to the European Union have “nearly doubled” over the past decade. Despite facing a 27% tariff on its electric vehicles, BYD saw its European sales more than triple last year. In the United Kingdom, where the tariff rate is only 10%, annual sales of Chinese vehicles have surged nearly sixfold.
Sunak notes that consumers have their own reasons for choosing Chinese-branded cars. For instance, the Jaecoo 7—a model from the Chinese manufacturer Chery—became the best-selling vehicle in the UK market this September; it is priced one-third lower than the entry-level Range Rover Evoque, a model from the British brand Jaguar Land Rover that it emulates. Any government decision to impose additional taxes on Chinese vehicles must take into account the potential impact on consumers.
Beyond the automotive sector, Sunak points out that Germany—a traditional European manufacturing powerhouse—has even lost its long-held advantage in machine tools to China. China has now overtaken Germany to become the world’s largest exporter of machine tools.
Sunak observes that China possesses a robust, technology-centered industrial base, with the capacity to mass-produce high-quality goods. However, China also employs other methods to secure its competitive edge, including the use of substantial subsidies. The International Monetary Fund (IMF) estimates that industrial subsidies in China account for more than 4% of its GDP—roughly $800 billion annually. These subsidies take various forms, including loans from state-owned banks at below-market interest rates and the deliberate undervaluation of the Chinese yuan. The IMF estimates the yuan to be undervalued by approximately 20%, while some economists argue the margin could be as high as one-third.
Even setting aside the issue of subsidies, several characteristics of China’s industrial development pose a formidable challenge to other nations. China possesses massive production capacity; furthermore, as it advances into high-value-added sectors, it has simultaneously maintained its competitive edge in low-value-added manufacturing—effectively capturing the entire value chain.
Economic pressures often manifest in a nation’s political trajectory. Rishi Sunak noted that Volkswagen halted production within Germany for the first time last year, with the German industrial sector shedding as many as 15,000 jobs in a single month. Against this backdrop, the far-right party “Alternative for Germany” (AfD) achieved its strongest-ever performance in several constituencies—areas that were part of West Germany during the Cold War and possess a long-standing history of manufacturing. This trend highlights a correlation between the rise of the AfD and the decline of Germany’s manufacturing sector.
Sunak pointed out that while Germany had long resisted taking a “hard line” against China in economic and trade matters, its exports to China are now in a “free fall,” prompting a rapid shift in Berlin’s stance. Meanwhile, viewing China as an “existential threat” to European manufacturing, the European Union is developing defensive mechanisms for various sectors, including chemicals and machinery.
Germany and France are even discussing the implementation of a “kill switch” mechanism—a contingency that would allow the EU to immediately sever Chinese exports to Europe, for instance, should China retaliate against EU tariffs by cutting off the supply of rare earth elements. Sunak noted that, during his time as Prime Minister, most British automotive manufacturers he heard from expressed opposition to the government imposing tariffs on Chinese electric vehicles—citing concerns that China might retaliate, which could in turn impact British automotive exports to China as well as the business operations of UK firms within China.
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