Don't let car tariffs ruin China-EU "win-win green competition"
As the EU's case of imposing tariffs on China's electric vehicles was about to be voted on, Chinese Minister of Commerce Wang Wentao visited Europe and on September 19 met with Executive Vice Chairman and Trade Commissioner Dombrovsky of the European Commission (hereinafter referred to as the "European Commission"). Talks were held to negotiate on the EU's countervailing case against China for electric vehicles. Foreign Ministry Spokesperson Lin Jian said on September 18 that China has always held the greatest sincerity and is committed to solving problems through dialogue and consultation, and has put forward suggestions for flexible solutions. It is hoped that the EU will show sincerity and actions and seriously consider the reasonable concerns and suggestions of the Chinese industry. If the European Commission goes its own way, China will take necessary measures to resolutely defend the legitimate rights and interests of Chinese enterprises and industries.
"China has achieved the rapid transition to green transportation that all EU leaders have called for over the past 10 years." Eric Solheim, former Under-Secretary-General of the United Nations and former Executive Director of the United Nations Environment Program, said that Europe should "lay the red carpet" for Chinese car companies that are leading the electric vehicle market and invite these companies to invest in Europe. The European market brings a "win-win green competition", and protectionism is a lose-lose situation.
EU electric vehicle tariffs are about to be finalized
On September 13, Bloomberg quoted people familiar with the matter as saying that the 27 member states of the European Union plan to vote on imposing final tariffs on electric vehicles imported from China at the end of September to decide whether to base the current 10% tariff on imported vehicles., impose an additional tariff of up to 35.3% on electric vehicles produced in China.
The proposed final tariffs will be decided by a vote by the 27 member states of the European Union. Only 15 member states (accounting for 65% of the EU population) voted against the measure will the European Commission shelve, otherwise the new tariffs will take effect at the end of October this year and last for five years. It is worth noting that once the tax is increased, European car companies that produce electric vehicles in China, including German BMW and Volkswagen, will not be spared.
In October 2023, the European Commission launched a countervailing investigation without application from electric vehicle manufacturers in the EU. Since China and the EU agreed to launch consultations on the EU electric vehicle countervailing case on June 22 this year, the working teams of both sides have conducted more than ten rounds of intensive consultations. China has submitted tens of thousands of pages of facts and evidence to the EU side, and also proposed flexible solutions. However, on the one hand, the European side claimed that it was willing to resolve the problem through dialogue, but on the other hand, it quickly and hastily rejected China's proposal and never gave any specific case, showing no sincerity in moving towards each other. In July this year, the European Commission also announced the imposition of temporary countervailing duties on imported electric vehicles produced in China by companies such as BYD, Geely and SAIC.
Starting from September 14, Chinese Minister of Commerce Wang Wentao visited Europe and met respectively with Chairman of the Italian Automobile Manufacturers Association, Italian Deputy Prime Minister and Minister of Foreign Affairs and International Cooperation Taani, German Deputy Prime Minister and Minister of Economy and Climate Protection Habek, German Chancellery Minister Schmidt and other European leaders, and hosted a symposium on China-EU electric vehicle industry chain enterprises in Brussels, Belgium. On September 19, Wang Wentao held talks with Executive Vice Chairman and Trade Commissioner Dombrovskis of the European Commission to negotiate on the EU's electric vehicle countervailing case against China. Wang Wentao said on September 18 that in the face of the EU's anti-subsidy investigation on electric vehicles against China, China will carry out its efforts to negotiate and resolve the problem until the last moment. He emphasized that over the past 40 years, the most prominent feature of the China-EU automobile industry has been cooperation, the most valuable experience has been competition, and the most fundamental foundation has been a fair environment. "The current China-EU automobile industry has reached an important crossroads, and open cooperation is the best choice."
Sun Xiaohong, secretary-general of the Automobile Internationalization Professional Committee of the China Chamber of Commerce for Import and Export of Mechanical and Electrical Products, said in an interview with a reporter from China Youth Daily and China Youth Daily that China does not want a trade war between China and Europe. Leaders and people of insight from some EU countries have also called on China and Europe to avoid trade war. It is hoped that EU leaders and leaders of member states will proceed from the long-term interests of the two sides and take reasonable measures. If they cooperate, they will benefit both, and if they fight, they will lose both.
Many parties oppose EU tariffs on China
The rationality, compliance and fairness of the EU's anti-subsidy investigation on electric vehicles against China have aroused widespread doubts. Singapore's Lianhe Zaobao analyzed that EU member states have serious differences on imposing new tariffs on Chinese electric vehicles.
In the first round of advisory voting held by the European Union in July this year, 12 countries including Spain, Italy and France were accused of voting in support, with 4 member states opposing, including 11 countries including Germany, Finland and Sweden abstaining.
However, Spanish Prime Minister Sanchez recently called for "re-careful consideration" of imposing tariffs on Chinese electric vehicles during his visit to China. "I must tell you bluntly that all of us, not only member states, but also the European Commission, need to rethink our position on this action." Sanchez said that Europe and China have far more common ground than differences, and cooperation should continue to be strengthened.
German government spokesman Steffen Herbetreit welcomed Spain's statement, saying "this is our common direction." German Deputy Chancellor and Minister of Economy and Climate Protection Harbeck said that Germany supports free trade, welcomes Chinese automobile and parts companies to invest in Europe, disapproves of imposing tariffs on Chinese electric vehicles, and urges EU member states to try to negotiate with China. Come out a solution. On September 17, after meeting with Wang Wentao, Habek expressed his hope to avoid a trade conflict in which tariffs spiral and ultimately harm the interests of both sides at all costs."My position is very clear, we need a political solution."
Sweden also questions the European Commission's position. Swedish Prime Minister Kristersson previously said that the EU's tariff increase is a "bad idea" to undermine global trade. For industrialized countries such as Germany and Sweden, a "broader trade war" is not the way out.
Automobile manufacturing is a pillar and key area of the Hungarian economy. Kissei Zoltan, director of the Political Analysis Center of the Sazodweg Foundation in Hungary, said that over the past 40 years, Europe has benefited greatly from investment and trade cooperation with China. The best way to safeguard the interests of European consumers and businesses is to protect free trade through consultation, rather than getting involved in a trade war.
Hong Kong's "South China Morning Post" analyzed that as Spain and other EU member states that can play a key role in the voting have recently expressed their opposition to raising taxes on China, whether this EU policy will eventually be passed does not seem to be as previously predicted.
New tariffs will affect the global green transformation process
"If the EU imposes new tariffs on China's electric vehicles, it will harm the industry and consumer interests of both China and the EU, affect the global green transformation process, and affect the implementation of the EU's climate plan." Sun Xiaohong said.
Kissei Zoltan, director of the Political Analysis Center of the Sazodweg Foundation in Hungary, also admitted that the EU is promoting green transformation, but at the current pace of motorized transformation, this goal cannot be achieved. European carmakers simply cannot provide enough electric vehicles to achieve this goal, so they need the support of other manufacturers, including Chinese manufacturers.
Analysis by the global trade consulting firm Hannis Foundation pointed out that the greater victim of tariffs on green products such as electric vehicles is the European Green Agreement launched by the European Union at the end of 2019. Transportation is the EU's largest carbon emission area and urgently needs to be "decarbonized".
Sun Xiaohong said that China has always supported the development of the industrial chain and supply chain of the EU's new energy vehicle industry in an open and cooperative attitude, including the upstream battery industry, new energy vehicle production investment, and technical cooperation. The cooperation between China and the EU in the field of new energy vehicle industry chain is in line with both sides 'overall goals of promoting climate cooperation and green transformation and achieving sustainable and high-quality development. If the EU imposes additional tariffs, it will harm the industry and consumer interests of both China and the EU, affect the global green transformation process, and affect the implementation of the EU climate plan.
