China Launches Trade Investigation Amid Escalating Tensions with EU

 China announced on Wednesday its initiation of an investigation into what it claims are unfair trade practices by the European Union (EU), marking a further escalation in the ongoing trade disputes between the economic giants.

Jul 10, 2024 - 13:01
China Launches Trade Investigation Amid Escalating Tensions with EU

The investigation, unveiled by the Chinese Commerce Ministry, will scrutinize whether the EU has unfairly targeted Chinese companies involved in bidding for projects across its 27 member states. Specifically, the probe will focus on sectors including wind power, photovoltaics, security equipment, and electric trains.

This move comes in response to recent EU regulatory actions aimed at probing Chinese companies for alleged advantages gained through subsidies. Notably, the EU has launched investigations into whether Chinese subsidies provided to wind turbine manufacturers distort competition in projects located in Spain, Greece, France, Romania, and Bulgaria.

China has vehemently criticized these EU investigations, accusing the bloc of protectionism and distorting the definition of subsidies. Instances under scrutiny include Chinese companies bidding for a significant solar park project in Romania and the procurement of electric trains in Bulgaria.

According to the Chinese Chamber of Commerce for Import and Export of Machinery and Electronic Products, the investigation will conclude by January 10, with a potential extension to April if necessary.

The EU, for its part, has been ramping up trade defenses against Chinese imports. Last week, the bloc imposed provisional tariffs on electric vehicles from China, citing subsidies that allegedly provide unfair advantages to Chinese automakers. In retaliation, China has initiated its own investigation into European pork exports, indicating a tit-for-tat escalation in trade tensions.

Both the EU and the United States have expressed concerns over the influx of competitively priced Chinese automobiles potentially displacing domestic producers and resulting in job losses. Chinese auto exports have surged by approximately 30% in the first half of this year alone, exacerbating trade anxieties on both sides of the Atlantic.

The current investigations and countermeasures underscore the deepening rift between China and the EU, signaling a challenging period ahead for global trade relations amidst geopolitical tensions.