Tensions between China and the EU have escalated, leading to a strategic rethink by the European Commission. The relationship is described as 'not sustainable' due to a significant trade deficit and job losses in Europe. The EU is considering measures to protect its market from Chinese imports while maintaining dialogue. Key points include regulatory pressure on Chinese companies, threats of retaliation from China, and divisions within the EU regarding its approach to China. The situation remains uncertain as the EU reassesses its stance amidst internal disagreements and external pressures.