China's Tactics on EU Duties: A Game of Carrots and Sticks
By Mei Mei Chu, Joe Cash and Ellen Zhang
Beijing's strategic approach towards potential EU duties on China-made electric vehicles is causing ripples across the financial market. As the vote looms, China is employing a mix of threats and incentives to sway the 27 EU member states.
The looming threat of counter-tariffs on EU goods, particularly affecting countries like Spain, France, and Italy, has put the spotlight on the intricate trade dynamics between China and the EU. With exports of pork, dairy, and brandy at stake, the stakes are high for both sides.
While some EU members like Germany, Finland, and Sweden have not pushed for tariffs and have minimal exposure to the targeted export items, others are feeling the pressure. China's tactics, including key investments and deals, are already showing signs of success.
Spanish Prime Minister Pedro Sanchez's recent visit to China, where he expressed support for Chinese EVs and urged the EU to reconsider its stance, is a testament to China's influence. As China sweetens the deal with investments in green technology and machinery production, the implications for EU economies are significant.
The potential impact on pork, dairy, and brandy exports from the EU to China, valued at around $10 billion, underscores the economic repercussions of the ongoing negotiations. With China's growing dominance in the EV market, the EU faces a crucial decision that could shape future trade relations.
As China navigates its trade relations with the EU amid global economic uncertainties, the outcome of the upcoming vote on EV tariffs could have far-reaching consequences. With China's Commerce Minister set to visit Europe and engage in high-stakes discussions, the financial markets are closely watching the developments.
In conclusion, the evolving dynamics between China and the EU underscore the interconnectedness of global economies. As investors and stakeholders monitor the unfolding situation, the outcome of the EU vote on EV tariffs could impact financial markets and trade relations worldwide.