China and EU advance in negotiations to eliminate tariffs on electric cars

Brussels and Beijing are advancing negotiations to conclude an agreement aimed at eliminating tariffs imposed by European Union (EU) on imports of Chinese electric vehicles.

Bernd Lange, head of the European Parliament’s Trade Committee, revealed in an interview with the German channel NTV on Saturday that discussions are close to a positive outcome.

In October, the European Commission adopted tariffs that reach 35,3% on the battery electric vehicles (BEVs) manufactured in Chinain addition to the standard 10% tax on imported cars. These tariffs came into effect on October 30th.

“We are also still negotiating with the Chinese side regarding electric cars. We are close to a solution with China to abolish tariffs,” said Lange.

He added that the possible resolution of the conflict would include commitments by China to offer electric cars in the EU at a minimum price, which would help “eliminate the distortion of competition through unfair subsidies”, the initial justification for imposing the tariffs.

The introduction of these tariffs was the result of a year-long trade investigation by the EU, which defended the measure as necessary to protect European manufacturers from unfair competition, claiming that Chinese producers benefit significantly from state subsidies.

This policy, however, has generated divisions within the EU and provoked retaliation from Beijing, including provisional tariffs on European alcoholic beverages, ranging between 30.6% and 39%. These tariffs were a response to the EU’s actions and came into force on October 11.

Furthermore, in August, the Chinese Ministry of Commerce accused European producers of selling products below the market price in China, which could cause “substantial harm” to local producers, and launched anti-dumping investigations into EU pork and dairy products.

The situation has strained trade relations, with countries including Germany and Hungary expressing concerns about the risk of a trade war and urging a negotiated solution.

With information from RT