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Xiaofei Xu

Ji Siqi

China has added 14 entities from the European Union to its export control list, including German defence giant Rheinmetall, the Ministry of Commerce announced on Friday.
Effective immediately, the order means that the export of dual-use items – products with civilian and military applications, including some rare earth elements – from China to the named entities is prohibited, as is the shipment of dual-use items of Chinese origin to the listed companies and institutions.
The move came after another round of sanctions from Brussels against Russia, announced on Thursday, which targeted 14 companies from mainland China and Hong Kong.
In a statement, the commerce ministry explicitly cited these sanctions as motivation for its new export restrictions, calling the bloc’s actions “egregious”.
The EU barred the export of dual-use goods and technologies to 51 entities in its 21st round of sanctions against Russia, with firms from mainland China, Hong Kong, India, Turkey and the United Arab Emirates added to Brussels’ list.
The 14 EU entities named by the commerce ministry included Germany’s Rheinmetall, Italian electric motor maker Lafert and French drone developer Cavok UAS.
Brussels was analysing China’s measures to understand their impact, spokeswoman Paula Pinho said on Friday, adding that the EU would also seek clarification with Chinese authorities.
Beijing’s measures targeted three firms each from Germany and France, two each from Italy and Poland, and one each from the Netherlands, the Czech Republic, Bulgaria and Lithuania.
While Beijing and Brussels both targeted 14 entities, the named entities differ in size and influence. New entries on the EU’s list were mostly minor trade and logistics firms based in port cities such as Guangzhou, Shenzhen and Dalian. China, on the other hand, targeted key European defence players such as Rheinmetall.
From Beijing’s point of view, if it’s going to retaliate, the retaliation has to bite
Cui Hongjian, Beijing Foreign Studies University
The mismatch in sizes does not make the response any less reciprocal in Beijing’s eyes, said Cui Hongjian, a former diplomat who heads European studies at Beijing Foreign Studies University. The EU’s successive packages of Russia sanctions have cumulatively listed far more Chinese firms than China has targeted in return, Cui noted, so rather than matching Brussels company for company, Beijing has chosen to hit fewer but bigger names.
“Since this whole episode arose from the Russia-Ukraine war, I think it’s understandable that China is now pointing its retaliations at Rheinmetall,” he said. “From Beijing’s point of view, if it’s going to retaliate, the retaliation has to bite.”
Picking out a few small European trading firms for countermeasures might send the wrong signal to Brussels, which would defeat the purpose, according to Cui.
Sander Tordoir, chief economist at the Centre for European Reform, agreed that Beijing’s retaliation was measured and symmetric – 14 firms on each side – but said that the act of retaliation itself showed China was still not willing to take EU concerns about the country’s support for Russia’s war on Ukraine seriously.
The Dusseldorf-based firm is one of Europe’s biggest defence contractors and a pillar of Europe’s support for Ukraine in its war with Russia. The firm has been expanding rapidly in recent years to meet rising EU demands for military equipment as the war continues and Europe seeks ways to manage its own defence.
How much Beijing’s decision will actually hurt Rheinmetall is unclear. China dominates the supply of several critical raw materials, but the German group has been working to insulate its supply chains.
“On raw materials … we are stockpiling, actively stockpiling, strategic raw materials,” the group’s chief financial officer, Klaus Neumann, said during an earnings call in May, adding that the group had also been intensifying supply-diversification efforts to protect itself from possible disruptions.


Defence firms such as Rheinmetall tend to have better stockpiles of rare earths, and access to Western suppliers, than European civilian industry, according to Tordoir.
“Their production lines will not come to an immediate standstill,” he said.
The tit-for-tat escalation comes with EU-China relations already strained by a deepening trade dispute, centred on China’s ballooning surplus with the bloc, while tensions have been further exacerbated by Beijing’s strategic closeness to Moscow.
The EU and China are set to engage in a fresh round of trade talks in October, a deadline analysts say loomed large in Beijing’s calculations
“[The message is] not to let the EU get the idea that if it hardens its position, China will soften its own; I think that signal has now been sent,” said Cui.
Wang Yiwei, director of the Institute of International Affairs at Renmin University, said the tit-for-tat would persist as the competitive balance between the two economies continues to shift – Brussels reaching for tariffs, Beijing for export controls – “You fight your way, I’ll fight mine,” he said.
Tordoir noted that such wide measures targeting firms across the EU might serve to boost European unity and remind member states that cutting their own separate deals with Beijing is a “losing strategy.”
Additional reporting by Mia Nurmamat and Finbarr Bermingham


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Ministry of Commerce action follows a new round of EU sanctions on Russia that affected 14 firms from mainland China and Hong Kong


Ministry of Commerce action follows a new round of EU sanctions on Russia that affected 14 firms from mainland China and Hong Kong.


China adds 14 European entities to export control list, hitting back at EU sanctions

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Ministry of Commerce action follows a new round of EU sanctions on Russia that affected 14 firms from mainland China and Hong Kong

Ministry of Commerce action follows a new round of EU sanctions on Russia that affected 14 firms from mainland China and Hong Kong