According to Goldman Sachs, what percentage of China's annual nominal exports to the EU could be affected by existing and proposed EU trade curbs, and what key factors moderate the actual impact?

Goldman Sachs estimates that the EU’s existing and proposed trade measures could cover about 27% of China’s annual nominal exports to the bloc. However, the firm stresses that this figure 'does not translate directly to export loss', as the actual impact depends on final policy specifics and implementation. Key moderating factors include China’s cost competitiveness, its leverage in critical materials (e.g., supplying over 90% of the EU’s rare earth elements by weight), and Europe’s commercial interests—which create incentives for the EU to avoid measures likely to trigger severe Chinese retaliation.

What are the two most significant proposed EU trade measures highlighted by Goldman Sachs, and how does the bank characterize their potential impact and timeline?

Goldman Sachs identifies two major proposed EU measures: fresh tariffs on plug-in hybrids and an extension of the Carbon Border Adjustment Mechanism (CBAM). The CBAM expansion is described as 'a major escalation', with China facing the largest exposure; it may extend beyond steel and aluminum to cover an additional $58 billion of Chinese exports—primarily in electrical and transport equipment and machinery. Goldman notes the effective implementation of such CBAM extensions is unlikely before 2028, and the actual tax rate on downstream products 'may represent only a small share of the final export price'.

EU Trade Curbs Threaten 27% of Chinese Exports, Goldman Says

Aug 24, 2026

Goldman Sachs estimates EU trade curbs could impact 27% of Chinese exports, citing risks from tariffs on plug-in hybrids and expanded carbon border taxes on steel and aluminum. Implementation is expected by 2028, though reliance on Chinese rare earths may mitigate severe retaliation.

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