|Chinese Vice Premier of the State Council He Lifeng (R) and European Commission Executive Vice-President Valdis Dombrovskis join a press conference after the 10th EU-China High-level Economic and Trade Dialogue. (Photo: Reuters/Florence Lo)
Chinese Vice Premier of the State Council He Lifeng and European Commission Executive Vice-President Valdis Dombrovskis co-chaired the 10th EU-China High-level Economic and Trade Dialogue. Both sides agree that enhancing bilateral dialogue is an important step for the EU and China to improve their relations.
Increasing tensions over e-vehicles
China-EU relations have recently encountered many problems in multiple areas leading to reciprocal sanctions.
On September 13, the European Commission launched an investigation into whether to impose punitive tariffs to protect EU producers against cheaper Chinese EV imports.
The European Commission said China's share of EVs sold in Europe has risen to 8% and could double, noting that prices are typically 20% below EU-made models. This has led to a fear that European electric car manufacturers' sales will soon decline.
China's Ministry of Commerce immediately warned that the investigation was a protectionist act that will have a negative impact on bilateral economic and trade relations. Analysts warn that the EU’s punitive tariffs would prompt retaliatory actions from Beijing and ignite a trade war.
Trade between the EU and China last year totaled 923 billion USD, but with a “very unbalanced” trade deficit of almost 427 billion USD. The EU attributes the trade deficit to China's restrictions on European companies. Market barriers have pushed the EU trade deficit with China to its highest level in history.
Trend of mutual cooperation and inseperable relations
Stable relations and balanced trade cooperation are the key messages that Dombrovskis conveyed at the Dialogue. He called on both sides to create an open market and promote free and equal trade. Beijing and Brussels should cooperate on resolving global issues like food insecurity and climate change. He said the EU should reduce its dependence on certain strategic products and take targeted actions to retain its strategic autonomy.
Experts say that, overall, despite major disagreements, the EU and China have much space for dialogue and cooperation. Both sides attach importance to their current relationship, especially in economics. The EU does not want more economic and diplomatic tensions with China when it is in a full-fledged confrontation with Russia. And China doesn’t want to damage its relationship with a major trading partner.
Despite difficulties in political and diplomatic relations, economic and trade cooperation between China and Europe continues to expand. China’s exports to the EU nearly doubled from 2018 to 2022. In the first half of this year, China was the largest goods supplier to the EU.
The China-EU High-Level Economic and Trade Dialogue was an important step toward easing trade tensions and stabilizing EU-China relations.