China surpassed the U.S. as the European Union’s main trading partner in 2020, according to data released on Monday by Eurostat.
EU exports to China grew by 2.2 percent in 2020, according to the report, while imports from China into the EU grew by 5.6 percent. In comparison, EU exports to the U.S. shrank by 8.2 percent and imports from the U.S. shrank by 13.2 percent.
The U.K. came in as the EU’s third-largest trading partner in 2020.
“The reason behind it is clearly the fact that China/Asia is the only region going through a nice V-shaped recovery,” Carsten Brzeski, ING Germany economist, told CNBC of the global economic recovery from the coronavirus.
“Looking ahead, the importance China has for European trade is also a clear dilemma,” Brzeski added. He stated that “Europe will have a hard time making choices” when it came to trading with China and aiding the U.S. in technology.
China is one of the few countries to begin recovering from the economic effect of the pandemic, CNBC notes, having avoided enacting a number of severe social restrictions like many other countries have.
The EU reached an investment agreement in December that made it easier for European firms to operate in China. The deal has not been approved by European lawmakers.
“By pulling together we can recover more quickly economically, and make progress on areas of mutual interest such as trade and investment relations,” European trade chief Valdis Dombrovskis said at the time of the deal’s announcement.