- China’s state-controlled Global Times reported that China wants the EU to scrap its preliminary tariffs on Chinese electric vehicles by July 4.
- Both sides agreed to restart talks after a call between EU Commissioner Valdis Dombrovskis and China’s Commerce Minister.
China’s state-controlled Global Times has reported that the EU wants to scrap its preliminary tariffs on Chinese electric vehicles by July 4 after both sides agreed to hold new trade talks.
Provisional European Union duties of up to 38.1 per cent on imported Chinese-made EVs will kick in by July 4 while the bloc investigates what it says are excessive and unfair subsidies.
China has repeatedly called on the EU to cancel its tariffs, expressing a willingness to negotiate. China does not want to embroil the country in another tariff war, still stung by US tariffs on its goods imposed by the Trump administration, but says it would take all steps to protect Chinese firms should one happen.
Both sides agreed to restart talks after a Saturday call between EU Commissioner Valdis Dombrovskis and China’s Commerce Minister. The call was during Germany’s economy minister’s visit to China, and the minister said the doors for discussion were “open.”
European Commission spokesperson said, “EVP Dombrovskis and China’s Commerce Minister Wang Wentao had a candid and constructive call on Saturday on the EU’s anti-subsidy investigation into battery electric vehicles produced in China.”
“The EU side emphasised that any negotiated outcome to its investigation must effectively address the injurious subsidisation,” they added.
The tariffs will be finalised on November 2 at the end of the EU anti-subsidy investigation.
EU trade policy has become increasingly protective over concerns that China’s production-focused development model could flood the country with cheap goods as Chinese firms look to step up exports amid weak domestic demand.
China has rejected accusations of unfair subsidies or an overcapacity problem, saying the development of its EV industry has been the result of advantages in technology, market, and industry supply chains.
“When European Commission President Von der Leyen announced she would investigate China‘s new energy vehicles… I had an intuitive feeling it was not only an economic issue but also a geopolitical issue,” said Zhang Yansheng, chief research fellow at the China Center for International Economic Exchanges.
“I think it is unfair to start a tariff war by only considering the capacity utilisation rate and insufficient demand,” he added.