Europe's deindustrialization anxiety is a complex issue that cannot be easily attributed to China's subsidies. While the claim that China's subsidies have caused Europe's deindustrialization is a variation of the "China threat" narrative, it fails to acknowledge the broader changes in the competitive landscape. The definition of "subsidies" has been expanded to include various forms of government support, which is a concerning trend. However, industrial policies are not unique to China, and the rise of China's manufacturing sector is a result of sustained investment, comprehensive industrial chain support, and market competition. Europe's manufacturing challenges are driven by high energy costs, carbon pricing, regulatory burdens, and structural issues. The US and other major economies are also expanding industrial policies and reshaping supply chains, creating a competitive environment that is not solely focused on a zero-sum game. Instead, it should be seen as a process of cooperation through technological innovation and industrial development. China and Europe share tangible common interests and strong structural complementarity. Europe's advantages in high-end manufacturing, green technologies, and standard-setting, combined with China's strengths in comprehensive industrial chains, market scale, and application scenarios, provide an opportunity for constructive cooperation. The real solution to easing Europe's manufacturing anxiety lies in finding a new position and partnership within the global division of labor, through domestic reforms, external safeguards, and a shift from anxiety to constructive cooperation.
