Top EU official warns on 'weaponization of trade' as tensions ramp up between the U.S. and China

The European Union's trade chief on Wednesday warned against the "weaponization" of trade amid the latest ratcheting up of tensions between the U.S. and China.

EU trade commissioner Valdis Dombrovskis told CNBC that he did not believe trade "protectionism" was the answer to heightened geopolitical tensions, but insisted that the bloc was willing to defend itself in the new trade environment.

"The geopolitical landscape is changing, it's getting more fragmented, it's getting more conflictual, we see the weaponization of trade. So we need to equip ourselves also as the European Union to function in this more conflictual world," Dombrovskis told CNBC's Karen Tso.

His comments came in response to remarks made Tuesday by former European Central Bank president and former Italian prime minister Mario Draghi, who said the bloc must undergo a "radical change" if it is to remain competitive in the face of China and the U.S.' refusal to "play by the rules." 

It comes as U.S. President Joe Biden is set to call on the U.S. Trade Representative Katherine Tai to triple the China tariff rate on steel and aluminum imports as he seeks to boost union support in the swing state of Pennsylvania.

Such a measure would essentially preclude Chinese steel sales in the U.S., and likely reroute Chinese goods to other global markets.

Dombrovskis said the proposals would have a clear impact on the EU, and noted that representatives were currently engaged in talks with the U.S. on its China tariffs.

"Obviously it's going to have broader repercussions because it's clear that the steel market is globally connected," he said.

Biden's call marks the latest escalation of tensions between the world's two largest economies over concerns of Chinese overcapacity.