Charles Michel, former President of the European Council and former Prime Minister of Belgium, is optimistic about the China-EU trade talks, saying he expects progress in the coming months. He told reporters at a media briefing in Shanghai that both sides were willing to pursue more common ground through talks. “On the EU side there is an expectation that by the end of October or November, or at least by the end of the year, there will be some progress achieved in the fields of those four tracks,” he said, referring to a consultation mechanism between China and the EU established in June, where four topics – trade and investment, export controls, intellectual property rights (IPRs) and World Trade Organization reform – had been discussed.
At that time, the EU Commission set a three-month deadline for rebalancing trade ties, amid fears that cheap Chinese imports were helping to deindustrialize parts of European manufacturing. “China needs the access to the European Union’s markets, and China does not have alternatives,” Michel said, who is now Professor at the China-Europe International Business School (CEIBS). He added that EU market access was of important political and economic value, with the EU using it as leverage during negotiations.
This month, European Commission President Ursula von der Leyen is expected to announce new measures aimed at rebalancing ties with China, which national leaders will then debate at a summit in Brussels in October. Chinese exports of low-value goods to the bloc fell by 54% in value terms and 40.8% in volume terms in July, after a new tax of €3 was levied on all packages worth less than €150 coming from outside the EU from July 1. But anti-subsidy tariffs on battery electric cars (EV), ranging from 17.8% to 45.3%, have yet to effectively curb surging sales of Chinese-made vehicles to the bloc.
In July alone, China’s EV exports to France soared 365.5%, while the figure was 530.9% in the Netherlands. The Dutch figures are likely inflated, since Rotterdam is a main port of entry for goods bound for the rest of the bloc. Germany, Europe’s automotive hub, brought in 40.8% more EVs from China in July than a year earlier. In January, the European Commission and Beijing reached a consensus to replace the tariffs with price undertaking agreements with individual Chinese carmakers through negotiations. “This minimum price mechanism is already an attempt to make progress in those negotiations,” said Michel. “On the other hand, from the European perspective, it’s not so easy because implementation of such an agreement would be quite complicated,” Michel added, as reported by the South China Morning Post.
