EU and China start 3-month talks to avoid trade war over €360bn gap

The European Union and China have agreed to hold three months of formal talks to try to prevent a trade war. The discussions aim to address the EU’s €360bn (£310bn) annual trade deficit with China, where the bloc imports far more goods than it exports. In their first joint statement in seven years, both sides met in Brussels and agreed to open a trade consultation. The move follows weeks of threats from China, which warned it would retaliate if the EU imposed measures to slow the flow of Chinese goods and components into the bloc. The two sides said they would work to make their trade relationship “more balanced.” The talks are seen as a key step to avoid escalating tensions that could disrupt global supply chains.