Harmony and Reasoning | Suppressing China's Electric Vehicles Violates the Open Market Principle: The EU Should Focus on the Overall Situation and Act with Prudence
Last week, the European Union announced that it will launch a countervailing investigation into China's exports of electric vehicles. This move is aimed at safeguarding its own industrial interests under the pretext of "fair competition". The anti subsidy investigation is expected to be implemented within 9 months after its launch. Once it is determined that the price advantage of Chinese electric vehicles is "dependent on subsidies" and "harms the interests of European manufacturers," Chinese exported electric vehicles will be subject to an additional 10% -15% tariff.
However, in response to the EU's protectionist measures, the beneficiaries seem to have responded mediocrely, and even some companies are starting to worry about whether this approach will have negative impacts and harm healthy market competition within the automotive industry and global supply chains.
"An open market can help growth and create wealth," said Kang Linsong, CEO of Mercedes Benz Group, in a Bloomberg interview on Tuesday. "Let's continue to maintain market openness and let participants strive for it." His statement carries profound implications.
Currently, some European politicians are vigorously implementing various trade protectionism measures against China. However, such practices not only seriously damage China Europe economic and trade relations, but also create obstacles for the market and disrupt the global automotive industry supply chain.
As Kang Linsong said, the supply chain can become very fragile. He also said, "The idea of dividing the automotive world into individual regions that are unrelated to each other is completely a fantasy."
China has always supported open markets and fair competition, and also welcomes European automotive companies to expand their investments in China. For many European automotive companies, China is their largest overseas market. For example, like Volkswagen and BMW, China is also Mercedes Benz's largest single market in the world, with sales in the Chinese market accounting for about one-third of its total sales. Open up the markets of various countries within the framework of the World Trade Organization, ensuring a win-win situation for all participants.
The current electric vehicle dispute is no longer the first trade dispute between China and Europe. Ten years ago, the European Union determined that the pricing of photovoltaic panels and related components exported from China was too low and imposed punitive tariffs on them. However, after the two sides reached an agreement on the price and sales of China's exported photovoltaic products to the European Union, the dispute quickly came to an end.
I hope that this time, from the perspective of maintaining the comprehensive strategic partnership between China and Europe and maintaining global industrial and supply chain stability, both sides can still resolve this dispute through dialogue and consultation. If a fair, non discriminatory, and predictable market environment can be established for the development of the electric vehicle industry, and if we can jointly address the climate change crisis, both sides will benefit from it.
This article is translated from the September 21st editorial of China Daily
Original EU anti subsidy probe hurts an open market
Production: Editorial Office of China Daily
Compiled by: Tu Tian [Responsibility]
