European Union Takes Trade Action Against Chinese Exports
After months of deliberations, the European Union has decided to impose tariffs on select Chinese imports in response to trade practices deemed unfair. The move marks a push back by the EU against Beijing’s industrial subsidies and rules forcing foreign companies to transfer technology.
While some see this as a punitive measure, a senior EU official says the duties are not meant to punish but rather achieve fair competition. The Minister for Economic Affairs and Climate Action of Germany stated that the tariffs were a necessary step for the EU to defend itself and should not be viewed as a sanction. He explained that the aim is to have a level playing field for companies on both sides and encourage China to comply with World Trade Organization rules.
The duties will impact an estimated €4 billion worth of Chinese goods annually including industrial machinery, high-tech equipment and steel. Products like cranes, excavators and video surveillance equipment will now face additional import taxes of between 4.3% to 49.9%. The EU asserts these goods benefited unfairly from large state subsidies provided by China to local companies, giving them an unfair advantage over European rivals.
While the tariffs are meant to encourage China to remove discriminatory measures hurting EU exporters, there is uncertainty on how Beijing will respond. Some experts opine that tit-for-tat tariffs from China could follow. However, the German Minister struck an optimistic note, expressing hope that the calibrated EU response opens the door for constructive dialogue to resolve long-standing issues negatively impacting trade. He stated the aim is cooperation, not escalation of tensions.
