On September 19, 2024, in Brussels, China's Minister of Commerce, Wang Wentao, met with EU Trade Commissioner Valdis Dombrovskis amid rising tensions over proposed EU tariffs on Chinese electric vehicle (EV) imports. The EU plans to impose import duties of up to 36% on some Chinese EVs, in addition to the standard 10% tariff, citing unfair competitive advantages due to China's state subsidies.
Beijing has rejected the EU's findings, with Wang stating that China will continue negotiations until a resolution is reached. Dombrovskis indicated that both sides are seeking a World Trade Organization (WTO) compatible solution. Reports suggest the EU might reduce its tariff proposals, with potential cuts for companies like Tesla and Geely, while maintaining higher rates for others not cooperating with the investigation.
China has threatened retaliatory measures, including higher tariffs on EU products, particularly targeting France due to its pro-tariff stance. The Chinese government has also initiated investigations into European pork, brandy, and dairy imports, asserting that EU subsidies provide an unfair advantage in the Chinese market.
Despite these tensions, some EU member states, notably Germany and Spain, have shown reluctance towards the proposed tariffs. German Chancellor Olaf Scholz has emphasized the importance of keeping markets open, while Spain's Prime Minister Pedro Sanchez has urged a reconsideration of the tariff plans. The EU's decision on tariffs requires a qualified majority vote, which may prove challenging amid differing opinions among member states.
The ongoing trade spat highlights the delicate balance China must maintain to keep the European market open amidst its economic struggles and the tightening US market. Experts suggest that while China is leveraging threats of tariffs, it is cautious about escalating the conflict further.