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Policy Briefing

EU–Asia Relations Briefing — March 29, 2026

Published March 29, 2026 — 07:04 UTC

EU–Asia Relations Briefing — March 29, 2026

Automated policy briefing on EU–Asia Pacific relations generated with AI-powered web search.

Political Relations & Strategic Rivalry

Executive Summary

In the last 48 hours, EU-China relations have been marked by a significant move towards new EU sanctions on Chinese entities linked to Russia's military-industrial complex, signaling a hardening stance on Beijing's support for Moscow. Concurrently, diplomatic engagement continues in specific areas, with a European Parliament delegation preparing for a visit focused on internal market issues and a high-level conference held on climate cooperation, reflecting the EU's "de-risking" strategy of targeted engagement alongside defensive measures.

EU Institutional Actions

  • European Council/Commission: The EU has decided to introduce sanctions on Chinese companies for supporting Russia's military industry, with a new package listing seven Chinese businesses slated for discussion by EU member states this week (as of March 26, 2026). This follows previous sanctions packages in October 2025 and earlier in 2025 and 2024, which targeted Chinese and Hong Kong entities for similar reasons.
  • European External Action Service (EEAS): On March 26, 2026, EU Ambassador Jorge Toledo delivered opening remarks at a high-level conference in Beijing on "Shaping the Future of Multilateral Climate Governance: EU–China Cooperation in a Changing Global Landscape," underscoring commitment to cooperation on climate and environmental issues.
  • European Parliament: A delegation from the Internal Market Committee (IMCO) is scheduled to travel to China next week (starting March 30, 2026), marking the first such trip in eight years. The focus will be on internal market issues, including industrial overcapacity and digital platforms, aiming to secure fair competitive conditions and ensure compliance with European standards.

Key Bilateral Developments

  • EU-China: German Chancellor Friedrich Merz stated on March 26, 2026, that he could envisage a future trade deal with China, suggesting a potentially more accommodating stance in some European capitals towards Beijing, despite broader EU concerns. This comes weeks after his first visit to China as Chancellor.

Sector Analysis

Trade/Investment: Trade tensions are expected to intensify in 2026, with the EU continuing to diversify away from Beijing and strengthening its trade defense mechanisms. The upcoming European Parliament delegation visit will specifically address Chinese industrial overcapacity and the regulation of digital platforms like TikTok, Shein, Temu, and Alibaba, aiming to ensure fair competition and product safety.
Defence/Security: The EU's decision to sanction additional Chinese companies for their support of Russia's military-industrial complex highlights ongoing concerns about China's role in undermining international security.
Technology/Digital: The European Parliament delegation's agenda includes discussions on digital platforms and ensuring Chinese digital companies comply with European rules, reflecting the EU's focus on digital sovereignty and fair competition.
Climate/Energy: A high-level conference in Beijing on March 26, 2026, emphasized EU-China cooperation on climate and environmental issues, including strengthening ties between think tanks and academic institutions for a green transition.

Implications for Analysts

  • For Europe: Analysts should monitor the implementation of the new sanctions package against Chinese entities and observe whether the nuanced diplomatic signals, such as those from Germany, indicate a potential divergence or a more flexible interpretation of the EU's "de-risking" strategy among member states.
  • For Asia: Analysts should assess China's response to the impending EU sanctions and how this will impact Beijing's strategic calculations regarding its support for Russia, as well as its diplomatic engagement with individual EU member states.

Outlook

Strained
The recent decision by the EU to impose new sanctions on Chinese entities for supporting Russia's military-industrial complex, coupled with ongoing trade tensions and the EU's continued "de-risking" efforts, indicates a predominantly strained relationship, despite targeted cooperation in areas like climate.

Economic Relations, Trade & Investment

Executive Summary

In the last 48 hours, a notable development in EU-Asia economic relations involved China's call for the European Union to ease high-tech export controls. China's Commerce Minister expressed a desire for the EU to refrain from politicizing trade issues and to expand imports from the bloc. This highlights ongoing tensions and dialogue concerning market access and technology transfer between the two major economic powers.

EU Institutional Actions

  • No major institutional actions in this period

Key Bilateral Developments

  • EU-China: On March 27, 2026, China's Commerce Minister Wang Wentao conveyed to European Trade Commissioner Maroš Šefčovič China's willingness to expand imports from the EU and urged the bloc to relax controls on high-tech exports and avoid politicizing trade issues. This communication occurred during a meeting on the sidelines of a World Trade Organization gathering.

Sector Analysis

Trade/Investment: China has called on the EU to ease high-tech export controls, indicating a desire for more open trade in sensitive technological sectors.
Defence/Security: No major developments.
Technology/Digital: China's request for the EU to relax controls on high-tech exports underscores the strategic importance of technology and digital components in bilateral trade relations.
Climate/Energy: No major developments.

Implications for Analysts

  • For Europe: Analysts should monitor the EU's response to China's call for eased high-tech export controls, as this will indicate the bloc's willingness to balance economic engagement with strategic security concerns.
  • For Asia: Analysts in Asia should observe how the EU's stance on high-tech exports evolves, as it could impact China's access to critical technologies and influence broader trade dynamics in the region.

Outlook

Stable
While China has voiced concerns regarding high-tech export controls, there have been no new punitive trade defense measures or significant escalations from either side in the last 48 hours, suggesting a period of continued dialogue rather than immediate confrontation.

Digital Policies & Innovation

Executive Summary

No major new developments concerning EU-Asia digital partnerships, the implementation of the EU-Singapore Digital Trade Agreement, or new joint research projects under Horizon Europe involving South Korea or Japan in areas like AI, 6G, or semiconductors have been reported within the last 48 hours. The EU-Singapore Digital Trade Agreement (DTA) notably entered into force on February 1, 2026, marking a significant milestone in digital trade governance, though no further implementation progress has been detailed in this immediate period.

EU Institutional Actions

No major institutional actions in this period.

Key Bilateral Developments

  • EU-Singapore: The EU-Singapore Digital Trade Agreement (DTA) entered into force on February 1, 2026. This agreement aims to establish clear and predictable rules to facilitate cross-border digital trade, including commitments on electronic contracts and signatures, paperless trading, consumer protection, and transparency. However, no specific new developments or progress on its implementation have been reported within the last 48 hours.
  • EU-South Korea: No major developments regarding new joint research projects under Horizon Europe in AI, 6G, or semiconductors have been reported in the last 48 hours. South Korea is set to join Horizon Europe starting from 2025, becoming the first Asian country to associate with the program.
  • EU-Japan: No major developments regarding new joint research projects under Horizon Europe in AI, 6G, or semiconductors have been reported in the last 48 hours. The EU and Japan previously agreed on new deliverables for cooperation in these areas at their second Digital Partnership Council on April 30, 2024.

Sector Analysis

Trade/Investment: The EU-Singapore Digital Trade Agreement, which entered into force on February 1, 2026, aims to reduce regulatory friction and enhance legal certainty for businesses engaged in EU-Singapore digital commerce.
Defence/Security: No major developments.
Technology/Digital: While no new projects were announced in the last 48 hours, existing EU-South Korea collaborations include four co-funded semiconductor projects focusing on heterogeneous integration and neuromorphic chips for AI systems, announced in July 2024. The EU and Japan are also engaged in the '6G MIRAI-HARMONY' joint research project, funded by Horizon Europe, which utilizes advanced machine intelligence for network enhancements, initiated in May 2025.
Climate/Energy: No major developments.

Implications for Analysts

  • For Europe: Analysts should continue to monitor the practical implementation of the EU-Singapore DTA for its effectiveness in shaping global digital trade norms and its potential as a model for future agreements.
  • For Asia: Analysts should observe how South Korea's association with Horizon Europe translates into concrete research collaborations and its impact on the region's technological advancement, particularly in semiconductors and AI.

Outlook

Stable
Justification: While no immediate new developments were reported in the last 48 hours, the foundational digital partnerships and agreements, such as the EU-Singapore DTA and ongoing research collaborations with South Korea and Japan, remain in place and are actively progressing from earlier announcements.

Security & Maritime Cooperation

Executive Summary

The European Union has recently reaffirmed its commitment to peace and stability in the Taiwan Strait and the broader Indo-Pacific, notably during the Japan-EU Foreign Ministerial Strategic Dialogue. This stance, coupled with ongoing security consultations with China where concerns about regional tensions were raised, highlights the EU's active diplomatic engagement in the region. Furthermore, the EU has enhanced its internal maritime surveillance capabilities through the MARSUR III agreement, which could indirectly support its broader Indo-Pacific security objectives.

EU Institutional Actions

  • European External Action Service (EEAS) / European Defence Agency (EDA): On March 25, 2026, an agreement was signed to expand access to the MARSUR III maritime surveillance network to the EU's diplomatic service, Military Planning and Conduct Capability (MPCC), and operational headquarters for EU naval missions. This network facilitates the automated exchange of maritime surveillance information among 16 participating EU member states' navies.
  • EEAS: The 15th annual consultations on security and defence between the EU and China were held on March 24, 2026, in Brussels. During these consultations, the EU exchanged views on security issues in Asia and the Pacific, including maritime security in the East and South China Seas and the Taiwan Strait, and underlined its concerns regarding increasing tensions while stressing adherence to the UN Convention on the Law of the Sea (UNCLOS).
  • European Commission: On March 24, 2026, the "Team Europe" strategy on Subsea Cable Security and Resilience was launched. This initiative aims to establish a unified framework for protecting subsea cables as critical European assets and integrates this objective into the Global Gateway strategy to build "trusted digital corridors" with partners, including Japan and Pacific islands.

Key Bilateral Developments

  • EU-Japan: During the third Japan-EU Foreign Ministerial Strategic Dialogue on March 28, 2026, EU Vice President Kaja Kallas and Japan's Foreign Minister Motegi Toshimitsu reaffirmed the importance of maintaining peace and stability in the Taiwan Strait. Both sides also opposed unilateral attempts to change the status quo in the East China Sea or South China Sea through force or coercion.
  • EU-China: The 15th annual security and defence consultations took place on March 24, 2026, in Brussels, where the EU and China discussed maritime security in the Indo-Pacific, including the East and South China Seas and the Taiwan Strait. The EU conveyed its concerns regarding increasing tensions in the region.
  • EU-Australia: On March 24, 2026, the EU adopted a Security and Defence Partnership with Australia. This partnership is designed to bolster collaboration on defence industry, maritime security, cyber security, counterterrorism, and hybrid threats, including enhancing cooperation to protect critical maritime infrastructure in the Indo-Pacific.

Sector Analysis

Trade/Investment: No major developments.
Defence/Security: The EU has strengthened its internal maritime surveillance capabilities through the MARSUR III agreement and established a new Security and Defence Partnership with Australia, focusing on maritime security and critical infrastructure protection. The EU also consistently voiced concerns regarding stability in the South China Sea and Taiwan Strait in recent dialogues.
Technology/Digital: The European Commission's launch of the "Team Europe" strategy for Subsea Cable Security and Resilience underscores the EU's focus on safeguarding critical digital infrastructure and developing "trusted digital corridors" with Indo-Pacific partners.
Climate/Energy: No major developments.

Implications for Analysts

  • For Europe: Analysts should recognize the EU's sustained diplomatic and strategic efforts to uphold a rules-based international order in the Indo-Pacific, particularly concerning maritime security and regional stability, alongside its internal capacity building for maritime domain awareness.
  • For Asia: Analysts should monitor the increasing alignment between the EU and Japan on issues of Taiwan Strait and South China Sea stability, as well as the deepening of EU security partnerships with key regional actors like Australia, which could lead to a more pronounced European presence in Asia-Pacific security dynamics.

Outlook

Strained
Justification: Despite ongoing dialogues and new partnerships, the persistent expression of concerns by the EU regarding escalating tensions in the South China Sea and Taiwan Strait, particularly in its interactions with China, indicates underlying strains in the broader security relationship.

Environment, Energy & Critical Raw Materials

Executive Summary

The European Union continues to actively pursue diversification of critical raw material supply chains and strengthen green energy cooperation with Asia-Pacific partners, as evidenced by recent trade agreements and strategic dialogues. While direct, immediate impacts of the EU's Carbon Border Adjustment Mechanism (CBAM) on East Asian manufacturers in the last 48 hours are not explicitly reported, the broader EU push for economic security and sustainable trade is shaping engagement with the region. Key developments include the conclusion of an EU-Australia Free Trade Agreement and intensified cooperation with Vietnam on critical raw materials and green energy.

EU Institutional Actions

  • European Commission: Concluded negotiations for a Free Trade Agreement (FTA) with Australia on March 24, 2026, which includes provisions for EU access to Australian critical raw materials and strong sustainability commitments.
  • European Commission: The RESourceEU Action Plan, adopted in December 2025, is guiding efforts in early 2026 to establish a European Critical Raw Materials Centre to provide market intelligence, finance strategic projects, and manage diversified supply chains.
  • European Commission: Announced that the Horizon Europe 2026-2027 work programme will restrict the participation of Chinese and Chinese-controlled entities in all critical raw material-related research and innovation actions.

Key Bilateral Developments

  • EU-Australia: On March 24, 2026, the EU and Australia concluded negotiations for a Free Trade Agreement. This agreement is expected to facilitate EU access to Australian critical raw materials, enhancing supply chain resilience, and includes ambitious sustainability commitments.
  • EU-Vietnam: Diplomatic ties are being upgraded, with intensified cooperation in critical raw materials, semiconductors, and infrastructure, as outlined in a draft joint statement from January 28, 2026. Vietnam possesses significant, largely untapped deposits of rare earths and gallium, and is interested in developing its processing capacity.
  • EU-US-Japan: A Critical Minerals Ministerial held on February 4, 2026 (reported March 23, 2026) saw the EU, United States, and Japan commit to deepening cooperation in the critical raw materials sector, including an expedited EU-US Memorandum of Understanding to enhance supply chain security and identify joint projects.
  • EU-Philippines: As of March 18, 2026, the EU is continuing discussions with the Philippine government to launch a study identifying critical raw material sites, aiming to promote sustainable use and attract investments in the local mining industry to strengthen the Philippines' role in global supply.

Sector Analysis

Trade/Investment: The conclusion of the EU-Australia FTA on March 24, 2026, signifies the EU's ongoing strategy to diversify trade partners in the Indo-Pacific, following recent agreements with Indonesia and India, and includes provisions for critical raw materials and sustainability. While no direct tariffs or sanctions related to CBAM on East Asian manufacturers were reported in the last 48 hours, the broader context of EU trade policy is increasingly influenced by environmental and economic security objectives.
Defence/Security: The EU's focus on diversifying critical raw material supply chains, particularly away from China, has clear defence implications, as these materials are vital for strategic technologies. The restriction of Chinese entities from CRM-related Horizon Europe research underscores a security-driven approach.
Technology/Digital: Cooperation with Vietnam extends to semiconductors, AI, and cybersecurity, with both sides seeking closer collaboration on "trusted" telecommunications networks and semiconductor supply chains.
Climate/Energy: While specific CBAM impacts on East Asian manufacturers were not highlighted in the last 48 hours, the EU is actively pursuing green partnerships. ASEAN is implementing its Plan of Action for Energy Cooperation 2026-2030, with a World Bank report noting East Asia's vast untapped renewable resources, indicating significant potential for future EU-Asia green energy collaboration.

Implications for Analysts

  • For Europe: Analysts should monitor the practical implementation of new critical raw material partnerships and the RESourceEU Action Plan, particularly how effectively they reduce reliance on single-country suppliers and whether they can meet the EU's ambitious 2030 targets amidst global competition.
  • For Asia: Analysts should observe how East Asian countries, particularly those rich in critical raw materials like Vietnam, Indonesia, and the Philippines, navigate increased EU interest and investment, balancing economic development with environmental and social governance standards, and potential geopolitical pressures.

Outlook

Deepening
The EU is actively deepening its engagement with Asia-Pacific countries through strategic partnerships and trade agreements focused on critical raw materials and green energy, indicating a concerted effort to enhance economic security and diversify supply chains.

Sources

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