Temu and Shein are flooding the European market with cheap products from China – triggered by new US punitive tariffs. Experts warn of billions in losses and call for tough measures from the EU. Is Europe threatened by a new flood of cheap goods?
The latest escalation in the tariff dispute between the USA and China has unexpected consequences for Europe: more and more Asian container ships loaded with cheap goods are shifting their course across the Pacific towards European ports. The reason for this is the massive new punitive tariffs imposed by the United States on Chinese goods, which the Austrian trade association believes will lead to an increased “flood of cheap goods” from the Far East onto the European market.
„Instead of the USA, more and more Asian container ships with low-value goods are now heading for Europe,” said Rainer Will, Managing Director of the trade association, at a symposium in Vienna on Thursday. He is calling for drastic measures, including a temporary ban on Chinese low-cost shippers such as Temu, Shein and similar platforms in Europe.
Trump’s customs policy is driving flows of goods to Europe
The roots of the current development lie in an aggressive U-turn in US economic policy. Since his return to the presidency, Donald Trump has taken a tough line on China – with far-reaching consequences for global trade. On the night of April 9, 2025, US President Donald Trump announced a drastic increase in punitive tariffs on Chinese goods. The tariffs were raised from 104% to 125%. Trump justified this step with China’s “lack of respect for global markets” and emphasized that this measure was necessary to ensure fair trading conditions.
In addition, the previous duty-free import of parcels up to a value of 800 US dollars (around 724 euros) was canceled. The aim: to keep Chinese online trade out of the US market. The immediate consequence: massive detour of supply chains and trade routes, which are now increasingly focusing on Europe.
While the USA is sealing off its markets, Europe remains open – with far-reaching consequences. Currently, goods from non-EU countries can be imported duty-free up to a value of 150 euros. Suppliers such as Temu and Shein are exploiting precisely this regulation by often deliberately declaring goods below this threshold.
“The loss for Austrian retailers is around 4.5 billion euros,” says Will. According to the Austrian Retail Association, around 4.6 billion parcels were delivered duty-free to Europe in 2024 alone. Two thirds of these were incorrectly declared – a practice that not only results in tax losses but also massive distortions of competition.