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China urges EU to remove tariffs on electric cars, will take measures to protect Chinese firms

TraderKnows
TraderKnows
06-24

This month, the EU decided to impose tariffs of up to nearly 40% on electric cars imported from China. This unreasonable decision has also drawn strong opposition and protests from China.

According to China's official media, Global Times, Beijing hopes the EU will cancel the preliminary tariffs on Chinese electric vehicles by July 4th. This request came after both sides agreed to initiate new trade talks.

The EU plans to impose provisional tariffs of up to 38.1% on imported Chinese electric vehicles before July 4th, citing that China provides excessive and unfair subsidies to its electric vehicle manufacturers.

China has repeatedly called for the EU to remove these tariffs and expressed a willingness to negotiate. Beijing does not want to get entangled in another tariff war, especially since it has not yet recovered from the tariffs imposed on Chinese goods by the Trump administration. However, they have also stated that if a tariff war does occur, they will take all measures necessary to protect Chinese businesses.

After a phone call between EU Commissioner Valdis Dombrovskis and Chinese Commerce Minister Wang Wentao on Saturday, both sides agreed to start tariff negotiations. This coincided with the German Economy Minister's visit to China, who indicated that the door for discussions is "open."

The Global Times reported on Sunday night, citing observers, that the best outcome of the negotiations would be for the EU to cancel its tariff decision by July 4th.

The paper noted that the EU's increasing protectionist measures would trigger countermeasures from China, and escalating trade frictions would only result in a "lose-lose" situation for both parties.

The EU's anti-subsidy investigation will conclude on November 2nd, at which point the final tariffs will be determined.

China has denied the allegations of unfair subsidies, claiming that the development of its electric vehicle industry is a result of technological, market, and supply chain advantages.

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