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EU Commission targets WTO’s key rule in push to rebalance China trade

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EU Commission targets WTO’s key rule in push to rebalance China trade

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As the EU’s trade deficit with China keeps widening, the European Commission wants to revisit the WTO rule requiring members to extend the lowest tariff granted to one partner to all, known as the “Most Favoured Nation” principle under global trade rules.

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The status is important as it has shaped trade for decades and allowed countries like China to benefit from low tariffs even as it transitions from an emerging to a sophisticated market as the world’s second largest economy.

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With this new proposal, Brussels would link low tariffs to reciprocal market access. The move comes as European companies face persistent barriers in China, which has grown it trade surplus with the world and the EU despite calls to rebalance the relationship.

“The low tariffs should be matched with equal access to your [a trading partner’s] markets,” Šefčovič said on Friday after a meeting of EU trade ministers in Cyprus, adding: “I think that there has to be fairness on both sides.”

EU’s goods trade deficit with China keeps ballooning

The issue is set to surface at the WTO’s ministerial conference in Cameroon in March, one year after President Donald Trump jolted global trade with sweeping unilateral tariffs that challenged the multilateral system and have now been struck down by court.

WTO reform will dominate the gathering as policymakers grapple with a geo-economic landscape shaped by increasingly nationalist trade policies in both the US and China.

The “Most Favoured Nation” rule was designed to prevent discrimination among trading partners. But Brussels now sees it as contributing to structural imbalances with China.

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“When this principle was embedded into the international trade law and WTO practices, simply the world was different,” Šefčovič said. “The GDP of China represented around 5 to 6%. Today we are at the level of 20%.”

The EU’s goods trade deficit with China widened to €359.3 billion in 2025.

Critics have long argued that Beijing has not fully adhered to WTO practices since it joined the institution in 2001, citing extensive Chinese government state subsidies. Since, its economy has grown to become the second largest in the world only behind the US.

“The past three decades global trade has changed profoundly. Some WTO members have dramatically expanded their share of global trade, while keeping their own markets relatively closed,” Commissioner Šefčovič said on Friday. “And at the same time, state support and non-market policies have multiplied.”

The “Most Favoured Nation” rule has also been called into question by the deals struck over the past year by the US with trading partners under the threat of steeper tariffs.

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The EU-US agreement concluded last July sets 15% US tariffs on EU goods, while the EU committed to granting preferential treatment with zero tariffs on US imports.

Still, the trade agreements announced by the Trump administration have not been notified to the WTO, even though members are required to do so to allow others to assess their compliance with WTO rules.

The tariffs have also been declared ilegal by the US Supreme Court on the basis that the president exceeded his mandate by invoking emergency laws to push them throw. The ruling adds uncertainty to an already complex geopolitical context.

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Israel FM says Europe too divided, slams Spanish PM

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Israel FM says Europe too divided, slams Spanish PM

Israeli minister Gideon Sa’ar said Europe “does not have unified position” on what role it should play in Iran as European ministers sought to establish a joint approach Sunday.

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As Israel and the United States conducted a joint military strike on Iran, leading to the killing of Supreme Leader Ayatollah Ali Khamenei, Europe was kept on the sidelines.

EU member states did not participate in the operation and, in some cases, they were not informed prior as it is customary among strategic allies.

Asked whether Israel sought to keep Europe on the margins, Sa’ar said internal divisions within EU member states had kept them out of critical exchanges of operational details, unlike the United States, which the minister described as his country’s greatest ally.

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“In Europe, you have all kinds of approaches,” he told Euronews. “You have countries like the Czech Republic which is strongly supporting this operation and then you have Spain, which is standing with all the tyrants of the world.”

On Saturday, Spanish prime minister Pedro Sánchez was among the most critical voices in Europe, suggesting the US-Israeli strikes on Iran risk plunging the region into total war.

“We reject the unilateral military action of the United States and Israel, which represents an escalation and contributes to a more uncertain and hostile international order,” Sánchez said Saturday. The Spanish PM reiterated that message on Sunday.

“We urge for de-escalation and call to respect international law in all conflicts,” Sánchez added. “You can be against a heinous regime, like the Iranian regime, while also rejecting a military intervention that is unjustified, dangerous and outside of international law.”

Sa’aar said Israel considers the operation “fully justified” citing the right to self-defense from a regime that “has called for the destruction of Israel” and lashed at the Spanish prime minister for sending an “anti-Israeli, anti-American message.”

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“Read the statement, they are standing with Iran!” he added.

When asked if any of his European counterparts had manifested an interest in joining the military operation or provide support on the ground, Sa’ar said he held multiple exchanges with European ministers over the weekend and suggested that “if others want to join, they will know have to convey the message.”

On Sunday, Commission President Ursula von der Leyen appeared to back regime change in Iran in line with Israel and the US, saying that the “risk of further escalation is real. This is why a credible transition in Iran is urgently needed” in comments on Sunday.

Sa’ar told Euronews said the strategic strikes and the elimination of Khamenei alongside top regime commanders could “create the conditions to weaken the regime enough to allow the Iranians to take their future into their own hands”.

“The future leadership of Iran should be determined by the Iranian people through free elections. Our only requirement is that whoever comes to power in Iran must not pursue the destruction of Israel,” he said.

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Watch the full interview on Euronews from 8pm CET

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Video: ‘We Are Orphans’: Shiite Muslims Protest the Killing of Khamenei

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Video: ‘We Are Orphans’: Shiite Muslims Protest the Killing of Khamenei

new video loaded: ‘We Are Orphans’: Shiite Muslims Protest the Killing of Khamenei

Shiite Muslims around the world protested the killing of Ayatollah Ali Khamenei, Iran’s supreme leader and a senior Shiite Muslim cleric. He died on Saturday during U.S. and Israeli attacks on his country.

By Nader Ibrahim and Malachy Browne

March 1, 2026

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3 US service members killed, 5 seriously wounded in Iran operation

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3 US service members killed, 5 seriously wounded in Iran operation

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Three U.S. service members were killed and five others were seriously wounded as part of Operation Epic Fury, U.S. Central Command (CENTCOM) said Sunday morning.

In addition, several others sustained minor shrapnel injuries and concussions and are in the process of being returned to duty, CENTCOM announced.

“The situation is fluid, so out of respect for the families, we will withhold additional information, including the identities of our fallen warriors, until 24 hours after next of kin have been notified,” CENTCOM said.

Smoke rises over the city center after an Israeli army launches 2nd wave of airstrikes on Iran on Saturday.  (Fatemeh Bahrami/Anadolu via Getty Images)

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This is a developing story. Please check back for updates. 

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