Spanish PM Sanchez urges EU to reconsider China EV tariffs

Madrid (The Brussels Morning Newspaper) – Spanish PM insists European Union to ‘reconsider’ China’s electric vehicles tariffs plan.

Spain’s Prime Minister Pedro Sanchez expressed the European Union should “reconsider” a schedule to impose tariffs of up to 36 percent on Chinese electric cars, urging for a “compromise” between the economic powerhouses.

The European Commission, which supervises the bloc’s trade policy, announced last month that it intended to levy five-year import duties of up to 36 percent on electric vehicles imported from China. The following day, Beijing stated it would launch an investigation into EU subsidies of some dairy products exported to China.

How does Sanchez propose a compromise between the EU and China?

“I have to be blunt and honest with you that we need to reconsider all of us, not only member states but also the EU Commission, our position towards this,” Sanchez informed journalists after being asked regarding the tariffs at a news conference near Shanghai. As I stated before, we don’t need another war, in this case, a trade war,” he added.

“I think that we ought to build bridges between the European Union and China and from Spain. What we’ll do is to be productive, and to try to find a solution, a compromise between China and the European Commission.”

How is Spain positioning itself in the EU-China trade dispute?

Sanchez’s visit to China has noticed him meet top officials including President Xi Jinping and call for “dialogue and cooperation” with the world’s second-largest economy. The journey comes against the backdrop of mounting trade pressures between the European Union and China, primarily over Beijing’s subsidies for its electric vehicles sector.

PM Sanchez also called for Madrid and Beijing to support what he called a  “fair trade order”.

“We must work jointly to resolve differences through negotiation, in a spirit of dialogue and collaboration, and within multilateral frameworks,” he noted on social media after meeting Xi.

China and the European Union have butted leads in recent years on a range of topics relating to trade, technology, and national security.

What challenges does the EU face in balancing green growth with trade policy?

Brussels has established a raft of probes targeting Chinese subsidies for solar panels, wind turbines, and trains. But it meets a delicate balancing act as it attempts to defend Europe’s crucial auto industry and shift towards green growth while also averting a showdown with Beijing. The president of an EU business lobby in Beijing expressed the overcapacity of Chinese electric vehicles was among the greatest concerns facing European firms in the country.

A European Commission official has expressed the EU executive remained “open” to settling the trade dispute without resorting to tariffs — but that “it’s very much up to China to come up with choices”. Beijing has so far pointed an appeal against the measures with the World Trade Organization — which Brussels has admitted while voicing confidence the tariffs are WTO-compatible.