BERLIN: German Chancellor Olaf Scholz on Monday called upon the European Union and China to capitalize on ongoing talks aimed at resolving a dispute over proposed tariffs on imported Chinese electric vehicles, urging both sides to “seize the opportunity” before potential economic repercussions take effect.
Earlier this month, the European Union issued a warning of impending additional tariffs ranging up to 38 percent on Chinese electric car imports, following an anti-subsidy investigation. The move has heightened concerns about escalating trade tensions between the EU and China, potentially leading to a contentious trade war.
Over the weekend, the EU reported “candid and constructive” discussions between its trade chief and his Chinese counterpart regarding the tariff issue, with plans for further consultations in the near future.
Addressing the annual conference of the influential BDI industry lobby, Chancellor Scholz emphasized the critical nature of the upcoming weeks, urging swift action to achieve a resolution before the tariffs are scheduled to take effect in July.
“It is important for the EU and Beijing to seize the opportunity by the end of the month to reach an understanding,” Scholz stated, acknowledging that time remains for negotiations to yield a favorable outcome.
Germany, home to major automotive manufacturers like Mercedes-Benz, Volkswagen, and BMW, has expressed deep concern over potential impacts on its extensive investments in the Chinese market should retaliatory measures ensue from Beijing.
While Scholz expressed optimism for a diplomatic solution, he underscored the necessity for considerable progress from China’s side to achieve a mutually agreeable settlement.
Economy Minister Robert Habeck, speaking at the same event, warned against the dire consequences of a trade war triggered by the imposition of higher tariffs, stressing that such a scenario would result in losses for all parties involved.
During his recent visit to China, Habeck reiterated Germany’s willingness to engage in dialogue and emphasized that the proposed tariffs were intended to address economic challenges rather than to impose punitive measures.
For German automakers, the Chinese market remains a crucial segment, accounting for up to 36 percent of their global sales figures. The EU’s anti-subsidy investigation was launched in response to concerns over a surge in competitively priced Chinese imports potentially undermining European manufacturers.
