Reported 7 months ago
During President Xi Jinping's visit to France in May, the EU announced an increase in import tariffs on electric vehicles from China to as high as 48%. In response, China vowed to take 'all necessary measures' to protect its interests, but experts warn that China must be cautious in its retaliation to avoid sparking a more severe trade war. Potential retaliatory actions by China may focus on agricultural products from EU countries like dairy and pork, with reports suggesting investigations into EU imports of pork and consideration of a 25% tariff on EU imported vehicles with large engines. China may also target specific EU countries with pressure tactics instead of a broad response. While the EU's increased tariffs on Chinese electric vehicles may not have a significant impact due to Chinese companies' ability to profit and plans to build factories in the EU to reduce tariff impacts, experts suggest China will want to avoid overreacting to ensure its electric vehicle production can still access the European market without inciting a trade war. Additionally, China has threatened retaliation against EU's aviation and agricultural industries if tariffs on Chinese electric vehicles proceed. There are also discussions of potential large orders with Airbus in France. Economists warn that China may eventually resort to retaliatory measures despite current delays in retaliation actions.
Source: YAHOO