Wang Yi tells Europe China doesn't want Russia to lose in Ukraine 😶, Plus HK's Hang Seng booms on China's tech flows-- China Boss News 7.4.25

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What happened?

China’s top diplomat Wang Yi is in Europe this week trying to steady Beijing’s increasingly fragile relationship with the European Union.

His first trip to the continent in over a year includes high-level stops in Brussels, Paris, and Berlin. But the timing is tense.

Trade frictions are mounting. Brussels has slapped tariffs on Chinese EVs, blocked some Chinese firms from public procurement, and launched multiple subsidy probes.

Beijing has responded with tariffs of its own—targeting French cognac—and is watching closely as the EU edges closer to Washington on tech and security.

Wang’s mission is to stop the slide, pitching China as a reliable economic partner.

But beneath the pleasantries, tensions over trade, critical technology, and Russia’s war in Ukraine remain acute.

And, according to SCMP’s Finbarr Bermingham, Wang may have let the mask slip: he reportedly told the EU’s top diplomat that China doesn’t want Russia to lose in Ukraine—not out of solidarity, but because a Russian defeat could free the U.S. to turn its full strategic focus toward Beijing.

It’s a rare—and strikingly candid—glimpse into China’s underlying calculus.

If Wang’s remark—at once tone-deaf and undiplomatic— is true, it will reverberate across the Continent in ways Beijing may not fully grasp.

Why it matters.

Selective decoupling

For decades, China and Europe wove a web of interdependence, built on the logic of comparative advantage.

Europe supplied high-end goods and technology; China flooded its markets with low-cost manufacturing.

But as the winds of geopolitics shift, that once-mutually beneficial arrangement is coming undone. And what’s replacing it is something much more turbulent.

Brussels has taken aim at Beijing’s state-backed overcapacity in green tech—particularly electric vehicles (EVs) and solar panels—with a selective decoupling approach.

The European Commission claims China’s subsidized output distorts global competition and undercuts Europe’s industrial base.

Beijing, of course, sees it differently. But its retaliatory measures are not simply economic—they’re political.

France led the EU’s charge against China’s EV’s. In response, Beijing targeted France and Spain, individually, first with tariffs on cognac, then with threats to restrict EU pork exports.

Those moves were intended to splinter EU consensus and temper the bloc’s growing assertiveness.

Still, China cannot afford to lose Europe.

The EU is China’s second-largest export market, and its firms—from EV giants like BYD to telecom champions like Huawei—now rely on European access to scale globally.

That’s why top diplomat Wang Yi landed in Brussels this week, urging calm and reminding the EU that neither side wins from escalation.

Wang’s mission, then, is to defuse the present and postpone its logical conclusion until China is safely diversified into other regions.

And it’s not a bad plan. The reality is that Chinese firms are already sidestepping EU tariffs by manufacturing inside Europe—especially in Hungary and Spain.

Chinese influence in Hungary is well known—but Spain?

As, I wrote in March, while the EU tightens its grip on Chinese imports, Spain is welcoming billions in Chinese investment and deepening economic ties with Beijing.

In just the past year, Spain has:

• Secured a $1 billion Chinese investment in a green hydrogen park

• Launched a Chinese-backed EV terminal in Barcelona

• Approved a joint venture turning a former Nissan plant into an EV hub, led by China’s Chery and Spain’s Ebro-EV Motors

China’s Vice President Han Zheng visited the country last month to strengthen economic ties, building on Prime Minister Pedro Sánchez’s outreach to Xi Jinping.

It underscores how Madrid is positioning itself as a gateway between Beijing and the EU, actively courting Chinese investment in electric vehicles and green tech—the very sectors now under intense scrutiny.

Maybe it was the cognac

That said, trade isn’t the only crack in the EU–China relationship.

Europe remains deeply skeptical of Beijing’s so-called neutrality on Ukraine.

China hasn’t shipped weapons to Moscow—at least not in any way that can currently be traced back to Beijing.

Yet its economic lifeline to Russia—from energy deals to dual-use technologies—is raising eyebrows across Europe, and not without consequences.

Which is why China dispatched Wang Yi—its esteemed veteran diplomat and current steward of foreign affairs—to smooth things over.

In China, Wang is also called the “Silver Fox" (银狐)—a moniker that captures more than just the silver hue of his impeccably coiffed hair.

It speaks to a cultivated image: urbane, unflappable, and supposedly strategic.

In Beijing’s austere diplomatic circles, where rhetoric is often weaponized and expressions tightly controlled, Wang stands out for his smooth delivery and surgical precision.

Whether countering criticism in Tokyo as ambassador to Japan, or navigating the fault lines of U.S.-China competition as Xi Jinping’s top envoy, Wang has come to embody China’s more seasoned, seductive face of statecraft.

Out of a billion people, this is the one they send when the stakes are high.

Which is what made his comment in Brussels—delivered over chicken, cheesecake, and sweet potato mousse—all the more extraordinary.

As Bermingham reported, Wang told EU foreign affairs chief Kaja Kallas what many had long suspected but never heard so bluntly: China doesn’t want Russia to lose in Ukraine.

Not out of loyalty—but because a Russian defeat might free up the United States to turn its full attention to Beijing. Far better, apparently, to let the war linger.

This offhand confession startled EU officials—not because it was new, but because it was said aloud, by a country that insists it’s “not a party” to the war.

And just to be clear, Wang added: if China were truly backing Moscow, the war would be over already. 🙄

The rest of the meeting was no less disorienting. Wang offered history lessons, dismissed concerns over rare earth access, and—when pressed on raw material bottlenecks—suggested Brussels might fill out some forms faster.

Naturally, China’s readout offered the usual fare: mutual respect, shared goals, smooth sailing—as if the night had been pure protocol, garnished with a bread plate.

But, in Europe, Wang’s remark is unlikely to be digested so easily—especially with several flashpoints already simmering.

Top of the list: Brussels is preparing to sanction two smaller Chinese banks for violating Russia sanctions, drawing repeated warnings from Wang that any blacklisting would provoke retaliation.

At the same time, the EU is deploying its new foreign subsidy regulation to expand investigations into Chinese subsidies and market-distorting trade practices beyond electric vehicles.

Add to that the deepening freeze over rare earths—where Europe, like the U.S., is finding itself squeezed by China’s tightening grip—and Wang’s seat at the table begins to look less like reconciliation and more like cold leftovers.

According to Bermingham, Brussels emerged from the exchange pessimistic about the upcoming July 24–25 summit in Beijing and Anhui province—now expected to deliver little beyond climate cooperation.

As for Wang, his trip continues to Berlin and Paris, two capitals where tensions with Beijing were already nearing a boil.

To sweeten the mood and season a deal to the tastes of Europe’s heavyweights, the pewter proxy might do well to eat a slice of humble pie—and skip the spicy surprises.

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