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The China dilemma: Europe wants a new relationship with Beijing but is wary of retaliation



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China’s Premier Li Qiang waves as he walks back with German Chancellor Olaf Scholz.John Macdougall | Afp | Getty ImagesEurope is charting a new way forward for its relations with China, but officials in the region say they are wary about the risk of retaliation if they get it wrong.There has been growing momentum behind the idea of de-risking from China. At a G7 meeting in late May, both the U.S. and Europe agreed to reduce their dependency on Beijing — rather than completely cut ties.The U.S. has become increasingly more vocal about China’s threat to national security in recent years. Policymakers in Europe, meanwhile, have taken a more cautious approach — aware of how important the Chinese market is for its domestic companies.A senior EU diplomat, who takes part in the negotiations among the 27 EU capitals but did not want to be named due to the sensitive nature of the issue, told CNBC the …

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