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EU wants companies to diversify supply chains faster to reduce dependence on China

    25 May 2026
    General Interest
    energynomics

    European Industry Commissioner Stephane Sejourne urged companies on the continent on Friday to diversify their supply chains faster and not rely on a single country for resources, Bloomberg reports.

    “Too few companies in Europe integrate geopolitical risks and supply chain risks into their planning,” Sejourne said after a meeting of EU trade ministers. “We are calling on companies to modernize their business plans,” Sejourne added, according to Agerpres.

    The EU executive has been pressuring member states to diversify their supply chains, especially for critical materials. The European economy is particularly vulnerable to supplies from China, which has used exports as a leverage in political disputes.

    Recently, European Commissioner for the Economy Valdis Dombrovskis told Bloomberg News that in the coming days, the EU executive will discuss ways to reduce risky dependencies on Beijing. “It is clear that resilience and security come at a price, but in the current geopolitical context, it is important to make sure that we have this resilience, that we have diversification, because we see how other types of vulnerabilities and dependencies are being exploited,” Dombrovskis said.

    In December 2025, in its first economic security doctrine, the Commission told companies that they should consider a “security premium” to reduce vulnerabilities and increase Europe’s overall security. But officials and industry representatives say companies are ignoring Brussels’ calls as they try to balance the need to remain competitive with meeting their short-term profit goals.

    For example, European automakers have lobbied the Commission to temporarily suspend sanctions on Yangzhou Yangjie Electronic Technology Co, a major Chinese semiconductor supplier. The company was included in the EU’s 20th round of sanctions targeting China-based entities that the bloc says have supplied dual-use or weapons products to Russia. The Chinese semiconductor company was sanctioned in April after dozens of shipments of its technology were found in drones used against Ukraine.

    But European automakers have lobbied the EU to delay the ban, saying they have not had time to diversify their supply chains and that the measures would deplete stocks within weeks, the sources told Bloomberg.

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