China Protests EU Tariffs on Electric Cars: “Brazen and Unfair Protectionism”

Beijing has threatened “retaliatory steps” that risk defeating Europe, which is extremely dependent on China for its energy transition projects and raw material supplies

Wang Wentao

Beijing’s first official reaction to the European Commission’s decision to impose duties of 38% to 45% on imports of Chinese electric cars was not long in coming. China called the additional duties, imposed on electric cars exported to European Union countries, “brazen and totally unfair protectionism.”

Disagreements among EU member states have prevented reaching the necessary qualified majority, which consists of at least 15 member states representing at least 65% of the Union’s population. Nevertheless, the European Commission said it had received the “necessary support.” However, Brussels added that “negotiations with Beijing will continue to explore an alternative solution fully compatible with World Trade Organization (WTO) rules.” In the absence of a clear vote one way or the other, the European Commission, which has exclusive powers to set the bloc’s trade policy, will be able to apply the duties, which are theoretically set to take effect on October 31, 2024, remain in force for five years, and could raise product prices by up to 45 percent.

“The duties not only hinder trade and investment cooperation between China and the European Union, but also delay the green transformation of the European continent,” China’s Ministry of Commerce said in a statement. That is, without China, Europe’s already shaky Green Deal program cannot be implemented. And that’s because, according to a report by the Australian Research Center’s Climate Energy Finance, “Chinese companies that are world leaders in the clean energy sector are investing more overseas,” from wind and solar farms to lithium battery plants, from hydroelectric dams to transmission lines. According to Australian analysts, “over the past two years, Chinese companies have announced plans to invest around $100 billion worldwide in clean technology.”

As European media reminded us, “these investments also directly affect Europe, most notably Hungary, where huge battery and electric car factories are being built, and Italy, where the Ming Yang giant is working on the final details of a wind turbine factory.” In this case, the attempt is to avoid duties by producing directly on European soil.

The eyes of not only Chinese manufacturers but also European automakers, led by Germany, given that about 30% of the sales by the trio consisting of BMW, Mercedes, and Volkswagen still depend on the Chinese market, are fixed on a dialog between EU Commissioner Valdis Dombrovskis and Chinese Commerce Minister Wang Wentao (pictured) to find a negotiated solution to the dispute.

China’s Ministry of Commerce announced that “a new round of talks with the EU will be held on Monday, October 7,” reiterating the hope of finding “a negotiated solution that satisfies both sides.”