The European Union unveiled a comprehensive package on Wednesday aimed at enhancing its technological independence, featuring the Cloud and Artificial Intelligence Development Act alongside Chips Act 2.0. These legislative measures seek to reduce the bloc’s dependency on foreign technology and promote the development of European-made semiconductors, while fostering a more self-sufficient digital ecosystem.

Critics, including Daniel Friedlaender, Senior Vice-President and Head of Office at the Computer and Communications Industry Association, warn that the legislation risks fragmenting the digital market within Europe. Friedlaender described the Cloud and AI Development Act as potentially leading to "fragmented discrimination across Europe in 27 different ways” by granting national governments broad authority to exclude global technology vendors from outside the EU. He cautioned that this approach could create barriers for trusted suppliers from major technology-producing countries, potentially disrupting existing global supply chains.

The EU’s emphasis on "technological sovereignty" is viewed by some analysts as part of a broader shift by certain member states away from a traditional stance favoring open and free trade toward more protectionist policies. These developments have raised concerns in Beijing, which has emphasized the mutual benefits of China-EU economic and trade relations.

Chinese Foreign Ministry spokeswoman Mao Ning responded to inquiries about the EU initiative during a press conference in Beijing, underscoring that the foundation of China-EU relations is mutual benefit and win-win cooperation. Mao called for continued dialogue and communication to address economic and trade issues and urged the EU to adhere to the principles of a market economy, including free trade, fair competition, and open cooperation. She urged the bloc to avoid protectionist measures and to resolve differences through consultation.

The EU has recently adopted several measures as part of a “de-risking” strategy targeting China, though officials in Beijing contend that excluding Chinese companies could backfire, resulting in financial losses for European markets as well as impeding technological and economic advancement in Europe. Reports indicate the EU plans to use upcoming G7 and EU summer summits to consider additional trade restrictions specifically affecting China.

Despite political rhetoric advocating for “de-risking,” a recent survey by the European Union Chamber of Commerce in China shows that many European companies remain committed to their presence in China. The majority of surveyed firms intend to maintain or expand operations within China, with nearly one-third planning deeper localization, suggesting that business-level sentiment does not fully align with protectionist narratives.

Mao highlighted the long-standing interconnectedness of China-EU economic ties, citing more than 300-fold growth in annual trade volume over five decades and nearly $260 billion in two-way investment, as evidence of robust cooperation. She stated that such complementary economic strengths do not represent risks, nor does their alignment constitute a threat.

Observers note that protectionist policies contradict fundamental economic principles and could ultimately be self-defeating, harming all parties involved. Both sides are encouraged to engage constructively to reduce tensions and broaden cooperation, aiming for mutually beneficial outcomes.