The European Commission is set to impose provisional duties on Chinese electric vehicles (EVs) starting July 4, stirring concerns among industry experts and stakeholders. The plan includes tariffs ranging from 17.4% to 38.1%, on top of the existing 10% vehicle duty, following a preliminary ruling on an anti-subsidy investigation into Chinese EVs.
“The imposition of anti-subsidy duties must meet several requirements under WTO rules,” said Li Yang, a professor at the China Institute for WTO Studies at the University of International Business and Economics. “These include the existence of subsidies and their adverse effects on the domestic industries of importing countries.”
Li emphasized the need for a clear link between the subsidies and their adverse effects, demonstrating substantial harm to local companies. “This ensures anti-subsidy duties are applied fairly and only in genuine cases of harm from subsidized exports,” he explained.
The anti-subsidy investigation by the EU can be initiated either through complaints filed by enterprises with evidence or by the government itself. If procedural requirements are met, anti-subsidy duties may be imposed based on the findings. However, Li noted that “the EU’s anti-subsidy investigation is still under discussion in terms of procedures.”
According to Li, the competitive advantage of Chinese EVs lies not in subsidies but in their complete industrial chain. “The automobile industry, especially for EVs, is a high-tech sector requiring various parts and strict coordination between upstream and downstream industries,” he said.
China benefits from numerous industrial enterprises in regions like Shenzhen, Zhuhai, and around Shanghai, which lowers the cost of upstream raw materials compared to Europe. “Also, lower labor costs further reduce production expenses, giving Chinese new energy vehicles a price advantage,” Li added.
In recent years, China’s new energy vehicle industry has developed rapidly. “Domestically, competition within China’s new energy vehicle industry is fierce, leading to low prices. The same applies to exports to Europe,” he observed.
The proposed tariffs by the EU have raised concerns over potential negative impacts on global trade and the electric vehicle market. Industry experts fear that such measures could hinder the growth of sustainable transportation and lead to increased tensions in international trade relations.
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EU's additional duties on Chinese EVs entail broad negative effects
cgtn.com
