European Commission president Ursula von der Leyen said overcapacity concerns and China's support for Russia's war effort in Ukraine will also be on the table at the talks with Chinese leader Xi Jinping.

Addressing the European Parliament in Strasbourg, von der Leyen said Beijing was running the largest trade surplus "in the history of mankind" exporting vast amounts to the EU while making it harder for European companies to do business in China.

"If our partnership is to move forward, we need a genuine rebalancing, fewer market distortions, less overcapacity exported from China, and fair, reciprocal access for European business," she told lawmakers.

Beijing has sought to improve relations with the European Union as a counterweight to superpower rival the United States, but deep frictions remain over their economic relationship.

The trade deficit between China and the EU was a yawning $357 billion in 2024.

Brussels is worried that a manufacturing glut propelled by massive state subsidies could add to it, and result in a flood of cheap Chinese goods undercutting European firms.

"China cannot rely on exports to solve its domestic economic challenges. Overcapacity must be addressed at its source, it cannot simply be offloaded onto global markets," von der Leyen said.

The commission leader, who will travel to Beijing with European Council President Antonio Costa, said the pair will seek to loosen export restrictions on rare earths -- while Brussels also looks at "developing alternative supply resources".

The curbs have caused concern among businesses worldwide as China accounts for almost two-thirds of rare earth mining production and 92 percent of global refined output, according to the International Energy Agency.

China's close relations with Russia have also been the cause of discord.

"China is de facto enabling Russia's war economy, and we cannot accept this," von der Leyen said. "How China continues to interact with Putin's war will be a determining factor for EU China relations going forward."

The summit is scheduled to take place later on July 24-25 to mark the 50th anniversary of the establishment of diplomatic ties between China and the EU.