Electric Vehicle

EU probes China’s electric vehicle subsidies

Date: September 13, 2023. — The European Union has launched an investigation into China’s alleged unfair trade practices in the electric vehicle market. Ursula von der Leyen, President of the European Commission, revealed that the EU Commission has begun an anti-subsidy probe into Chinese electric vehicles. These vehicles are flooding the European market with unfairly low costs due to enormous state backing.

The decision was made as a result of months of pressure from France and other EU countries. The European auto industry feared losing position to Chinese rivals in the quickly expanding market for green mobility. China is the world’s top producer and buyer of electric vehicles. It promotes them to achieve its high climate goals.

According to the EU Commission, the probe will look into whether Chinese electric vehicle manufacturers are receiving disproportionate subsidies that distort the market and harm European companies. If the EU discovers proof of unfair trade practices, it may impose further duties on Chinese goods.

“Europe is open for business. Not for a race to the bottom,” said EU Commission President Ursula von der Leyen, who launched the investigation in her annual State of the European Union speech. “In a world of uncertainty, Europe must once again answer the call of history,” she added. It is that to emphasizing the EU’s commitment to upholding its values and interests in a variety of policy areas. That includes trade, environment, and foreign affairs.

The inquiry is likely to increase tensions between the EU and China. Moreover, these tensions have already been strained by human rights concerns, geopolitical crises, and economic competition. On September 25, the two sides are slated to hold a high-level economic and trade talks in preparation for a bilateral summit later this year.

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