EU and China to Continue Negotiations on EV Tariffs Alternative

Continued Discussions on EU Import Tariffs

The European Union and China have decided to continue their discussions about a possible alternative to the EU import tariffs on China-made electric vehicles. This decision was made just a week before these tariffs are due to come into effect, as announced by the European Commission.

Initiation of Video Call to Discuss EU Investigation

Valdis Dombrovskis, the European Commission’s Executive Vice-President and Commissioner for Trade, initiated a video call with Wang Wentao, the Chinese Minister of Commerce. The purpose of this call was to discuss the EU's investigation on imports of battery electric vehicles (BEVs) from China and the ongoing negotiations about price undertakings.

Imposition of Hefty Tariffs on Chinese Imports

Earlier this month, the European Commission received sufficient support from the EU member states to impose hefty tariffs of up to 45% on imports of electric vehicles from China. This decision was due to what was perceived as unfair subsidizing. The EU and China have been negotiating a potential alternative solution to these tariffs. However, if an agreement is not reached, the import duties will come into effect at the end of this month.

Continuation of Talks Despite High Import Duties

The Commission has stated that talks with China on an alternative to the EU tariffs will continue even after the high import duties are imposed next week.

Progress and Remaining Gaps in Negotiations

After the EU-China call on Friday, the Commission noted that the principals had taken stock of the progress made during eight technical negotiating rounds, as well as significant remaining gaps. Both parties reaffirmed their political commitment to finding a mutually agreeable solution, which would need to be effective in addressing the level playing field in the EU market and be compatible with the World Trade Organization. The principals agreed that further technical negotiations would take place shortly.

China's Reaction to Provisional EU Tariffs

The provisional EU tariffs, which have been in force since July, have led to a reaction in China. China is proceeding with anti-dumping investigations of EU imports, targeting brandy and pork imports from the bloc. This move is likely aimed at Spain, France, the Netherlands, and Denmark. Several EU member states, including Germany, and Germany’s giant automakers have expressed concern that the tariffs could lead to a wider trade spat and retaliatory tariffs from China.

Bottom Line

As the EU and China continue their negotiations on a potential alternative to the proposed tariffs on China-made electric vehicles, the outcome of these discussions could have significant implications for international trade relations and the electric vehicle industry. What are your thoughts on these ongoing negotiations? Do you think a mutually agreeable solution can be found? Share your thoughts and this article with your friends. Don't forget to sign up for the Daily Briefing, which is available every day at 6pm.