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Businesses protest EU's protectionism

'Unfair competition' refuted, as industry insiders say move violates WTO rules

By CHEN WEIHUA in Brussels | CHINA DAILY | Updated: 2024-06-08 07:16

People visit the booth of Chinese carmaker Xpeng during the 2023 International Motor Show, officially known as the IAA MOBILITY 2023, in Munich, Germany, Sept 5, 2023. [Photo/Xinhua]

Chinese companies have expressed deep concerns over rising protectionism in the European Union, as the bloc ramps up its anti-subsidy probes targeting Chinese companies, especially those making clean energy products.

News site Politico reported that the European Commission is expected to inform Chinese EV makers of the duties they would face by the end of next week. The commission launched investigations last October into the "suspected unfair state subsidies" of Chinese EVs.

The China Chamber of Commerce to the EU, or CCCEU, said on Thursday that more than 40 Chinese companies operating across Europe have voiced grave concerns about the EU's escalating protectionism.

These companies have called on the Chinese government to address urgent issues, including the EU's anti-subsidy investigation into Chinese-made electric vehicles and Brussels' use of unilateral tools such as the Foreign Subsidies Regulation that specifically targets Chinese enterprises.

Chinese Minister of Commerce Wang Wentao and other senior officials heard their complaints during their recent visits to Spain, Portugal and Poland.

Speaking at a roundtable in Lisbon on Tuesday, Wang acknowledged the rising risks for Chinese companies in Europe. He called on the EU to commit to cooperating with China and ensuring a fair competitive environment for Chinese companies, according to CCCEU representatives who attended the meeting.

Chinese representatives from sectors such as finance, green energy, transportation, telecommunications, pharmaceuticals and construction discussed the EU's growing protectionist measures at the meeting.

CCCEU Chairman Xu Chen said the chamber's survey last year showed a continued decline in Chinese companies' overall assessment of the EU business environment, with 43 percent of respondents reporting a worsening situation over the previous year.

Chinese companies stressed that the EU's market environment has further deteriorated in recent months, marked by escalating trade protectionist measures.

While the EU claims these actions are necessary to address China's "unfair competition", Chinese companies argue that these swift measures have caused significant market barriers and impediments, and they urge the Chinese government to take effective steps to safeguard their legitimate interests, according to the CCCEU.

Wang refuted the "unfair competition" accusation and called it groundless. He said some countries are implementing high tariffs, discriminatory subsidies, investment restrictions and unilateral sanctions that contravene World Trade Organization rules, with the aim of excluding Chinese companies from their markets. "This is not fair competition at all," Wang was quoted by the CCCEU as saying.

Malicious attempts

"We embrace healthy competition, but stand firmly against any malicious attempts for suppression."

Erik Solheim, a Norwegian politician and former executive director of the UN Environment Programme, said the world needs more green products that are affordable and reliable.

"China is doing that. Everyone should compliment China," he said, adding that "it's a fantastic news for the world".

He said Europe and the United States should embrace the competition by welcoming Chinese companies to invest there so they can learn from superior Chinese technology.

In an article on the Forbes news site on Thursday, Neil Winton, a former European automotive correspondent for Reuters, warned that "cutting China's EV sales in Europe would undermine important EU plans to end the sale of new gasoline and diesel vehicles by 2035".

Mercedes-Benz CEO Ola Kaellenius voiced his stance against restrictions during an industry conference on Thursday in Bochum, Germany. He noted that the WTO rules are not keeping some countries from supporting their national producers.

"It is better to counter that with trade stimulus than with protectionism, especially for Germany, which has a strongly export-oriented economy," he was quoted by Reuters as saying.

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