Trade relations between China and the EU face a key week to determine whether the bloc will finally maintain tariffs on imports of electric vehicle batteries from Beijing. Next Wednesday, member states are expected to vote on whether to maintain those tariffs on imports from the Asian giant or to lift them instead. A fierce fight that will be opposed by Germany and Spain.
EU governments are set to vote on whether Brussels’ proposal to impose tariffs of up to 36% on electric vehicle imports from Beijing will come into force from November. The vote requires a blocking majority of the 15 Member States and 65% of the EU population to overturn the measure. The procedure will be conducted by secret ballot and the result is not binding.
The date could vary, however. And community sources have indicated that the The vote could be delayed by a few daysuntil September 30. The final rates would come into effect on October 30 for a period of 5 years, if a qualified majority is not obtained to reject the measure.
The balances of the Community framework are delicate and Germany’s weight in the EU decision-making process is undeniable. Its clear opposition to the application of additional customs duties on Chinese electric cars is in line with that of the others Member states such as Spain or Sweden.
Berlin is on the ropes because its automobile industry is particularly sensitive to trade relations with the Asian giant, where it carries out a large part of its production. So much so that major German car manufacturers They have already begun to express their indignation at Brussels’ tariff proposal.
Spain has also decided to play its cards. The president of the government, Pedro Sánchez, aligned himself with the German chancellor, Olaf Scholz, and urged the EU to “reconsider” the tariffs, during a recent trip to the Asian giant. Their intention was to persuade Xi Jinping’s executive not to apply reciprocal practices in terms of Community pig sectoran area in which Spain would be particularly affected.
However, Sánchez’s statements have not been well received in the community capital and have caused some discomfort. From Brussels, they have reminded him that the responsibility of Trade policy belongs to the EUand not to the Member States.
The first and second largest car manufacturers in the sector, Germany and Spain, respectively, they could count on the support of other member states, such as Sweden and Finland. And Berlin and Madrid are also particularly sensitive to investments from the Asian giant. If the vote continues the trend of last July, two EU heavyweights, France and Italy, would be in favour of applying customs duties.
Despite the dialogue established with Beijing, it seems that the Negotiations with Brussels are not progressing very favourably. The latest meeting took place last week when Chinese Commerce Minister Wang Wentao and European Commission Economic Vice-President Valdis Dombrovskis met in Brussels without a satisfactory outcome for both sides.
The Latvian reiterated that, despite criticism from Beijing, the investigation into Chinese electric vehicles is governed by World Trade Organization (WTO) rules and expressed his concern about investigations from China to European pork, dairy and brandy.
The European Commission has launched an investigation into imports of Chinese electric vehicle batteries into the EU, finding that they benefit from subsidies from the Beijing executive that violate competition rules and give their companies the ability to sell their products at lower prices, engage in practices of dumping.
Additional charges
The latest revision from Brussels thus reduces to 36.3% the maximum rate that would be applied to Chinese companies that did not cooperate in the investigation, compared to the 37.6% that it had set in July and which, in turn, represented a reduction compared to the 38.1% that was initially raised. The opposite happens with companies that collaborated in the process. The European Commission increased the rate to 21.3% for these companies, compared to 20.8% in July and also above the 21% at the beginning. Such the numbers would be added at the rate of 10% that already applies to imports of electric vehicles from China, although this additional rate would be reduced to 9% in the case of Tesla.
Dialogue between Chinese and European authorities continues. Beijing’s reception of the tariffs has not been entirely positive. While Brussels accuses China of applying “unfair” subsidies and giving its companies a competitive advantage, the Asian giant has called the European tariffs “protectionists” and “witch hunts”. Beijing has launched investigations into pork and dairy products imported from the EU for the same reasons.
The European Commission has also announced other investigations such as the sector of suppliers of wind energy or medical products from China. As a result, Beijing has counterattacked with suspicions about whether Europe sold cognac High quality at lower prices. A survey that ultimately ruled out the application of additional charges.
However, China has two other sensitive sectors in its sights. It has opened an investigation into EU pork and dairy products, both for allegedly benefiting from subsidies and trade practices. dumping.
The negotiation between the two powers is trying to find formulas compatible with the rules of the World Trade Organization. Rules that the European Commission considers that Beijing has violated. However, China has appealed to this body arguing that the EU’s interim tariffs “They have no legal basis.”
A global appeal
More and more countries have increased their tariffs on Chinese electric cars. The United States and Canada have opted for 100% tariffs. Turkey is applying an additional 40% tariff, India is applying a 70% rate to imports of vehicles priced under $40 billion and 100% to those over that amount, and Brazil raised the rate to 18% in July, to increase it again to 35% in 2026. Washington also increased tariffs on imports of Chinese solar panels, from 25% to 50%, and tripled rates on steel and aluminum, from 7.5% to 25%.
