According to a report by the South China Morning Post on October 23, the head of EU trade affairs said on Friday that before further negotiations with Beijing, the EU may impose import quotas or additional tariffs on more Chinese industries. He specifically noted that the EU's investigation into the plastic industry has made significant progress.
EU Trade Commissioner Maros Petrovic said that when the EU needs to take quick action to protect domestic industries, it will consider adopting safeguard measures rather than conducting lengthy negotiations. Safeguard measures allow the EU to take emergency actions to curb a surge in imports.
Shafajović said to reporters at a press conference in Dublin: "Obviously, we must clarify all matters, determine priorities, and always consider which tools are most effective. In some cases, we will definitely engage in further negotiations with our Chinese counterparts. In other cases, taking safeguard measures may be more appropriate and quicker."
Šefićović explained that the European Commission is currently seeking opinions from its member states to determine which areas should receive priority in terms of trade protection measures, especially those industries that member states believe are “under great pressure”.
He said, “But for now, I believe the industry most likely to take action is the plastics industry. We are working with the European Commission’s Directorate General for Trade to conduct research on this matter.” He added that the EU must ensure that any actions taken are based on ‘very solid grounds, considering both economic and legal aspects’.
Shafajović made the aforementioned statement after the EU Trade Ministers' Meeting in Dublin on Friday. During the discussions on China-related issues, participants identified the industries they were most concerned about. Irish Foreign Minister Helen McIndoe, who chaired the meeting, said that the industries mentioned included chemical, machinery, and some agricultural and food industries.
Earlier that day, French Trade Minister Nicolas Friscette boasted that France and Germany were working together to push the EU to adopt a more tough stance towards China, which led to Beijing adjusting its policies regarding the export of hybrid vehicles.
At the beginning of this month, the German government made a significant shift in its policy towards China. It joined forces with France to call for the implementation of tariffs, import quotas, and stronger new trade tools.
In the same week, China agreed not to retaliate against a measure taken by the EU. According to this measure, starting from December 1st, the EU will limit the annual imports of Chinese hybrid vehicles to 350,000 units. This change is generally seen by various sectors in Europe as a significant milestone in the EU's foreign policy.
For many years, Germany has been hindering the EU from shifting its trade strategy in a more aggressive direction. However, with Germany and France, two major economies of the EU, reaching an agreement, the pace of implementing related policies may accelerate.
The European Commission, responsible for formulating trade policies of the 27 member states of the EU, plans to propose three new policy tools before Christmas.
Among them, “DiversifyEU” is a policy proposal aimed at addressing the EU’s strategic economic dependence on a single non-EU country for key commodities and production inputs. This measure will require companies in key industries to diversify their supplier sources, in order to prevent key inputs from being used for weapons-making purposes.
A "coordination mechanism" will provide compensation to businesses that are affected by retaliation measures from trading partners. This is seen as a way to ensure that EU member states will not obstruct trade action against China. Meanwhile, an "emergency severing mechanism" will grant the EU near-instantaneous power to exclude Chinese businesses from the EU market.
When asked whether the “emergency termination mechanism” was a completely new policy tool, or merely an amendment to existing counter-stress measures that have never been activated, Sefović still seems to have not made a decision.
Shevtzovich said that in such a "volatile world," the European Commission is "studying the most appropriate institutional arrangements and legislative procedures to ensure that we can master this tool as soon as possible."
For many years, France has been advocating policies with greater protectionist elements in order to address market distortions caused by its perceived Chinese economic model. Fréritier still urges the EU to maintain the current policy direction.
He stated: “When you are clear in your attitude, honest in your words, and firm in your stance, the Chinese government can understand. This is necessary. For a long time, we have not done this. We must not only do this at the level of individual member states, but we must also take unified actions at the level of the European Union.”
Folcier even stated that Europe must have the ability to say "no" to China.
Meanwhile, the Chinese Ministry of Commerce stated that the understanding reached between China and Europe regarding hybrid cars is based on the three principles of adhering to WTO rules, proceeding on the basis of facts, and non-discrimination. This understanding is mutually beneficial and equal. It effectively safeguards the actual interests of Chinese enterprises, addresses the concerns of European parties, and prevents an escalation of trade tensions between China and Europe. The claim that "European pressure has been effective" is baseless.
China emphasizes that the European side should not hope for benefits through pressure, and should not underestimate China's determination and ability to safeguard its own interests. We urge the European side to move in a direction consistent with China's efforts, to promote the healthy and stable development of China-EU economic and trade relations.
