Beijing is taking steps to ease trade tensions following the European Union’s decision to impose tariffs on Chinese electric vehicles (EVs).
On Thursday, China’s Ministry of Commerce announced it will not impose provisional duties on imports of European brandy. However, the ministry accused the EU of excessively flooding the Chinese market with alcoholic products, which suggests that future tariffs may not be off the table.
The statement emphasized, “Imported brandies from the EU are being dumped into the Chinese market, potentially causing substantial harm to domestic brandy manufacturers.” This announcement came on the heels of Beijing launching an investigation after the EU began its probe into electric vehicles manufactured in China.
The European Commission has raised concerns that Chinese EV manufacturers benefit from state subsidies, allowing them to keep costs artificially low and adversely impacting their EU counterparts. Earlier this month, the Commission proposed imposing import duties of up to 36% on Chinese electric cars to mitigate these unfair trade practices, although this rate is lower than initially suggested.
As a result of China’s announcement, shares for European spirit makers soared on Thursday. Stocks of Rémy Cointreau increased by 6.4%, while Pernod Ricard rose by 4.3%, and shares of Italian company Campari gained 1.58% around 1 PM CEST.
In a press briefing, European Commission spokesperson Olof Gill responded to China’s decision, stating, “We acknowledge this announcement from the Chinese government and assure that the Commission is closely monitoring this investigation.” He added, “We are fully committed to supporting our EU industry throughout this process and maintain confidence that our cognac and brandy exports to China comply with all applicable WTO regulations. Moreover, I would like to highlight that the basis of this [Chinese] investigation is questionable.” Gill concluded, “We will not hesitate to take all necessary actions to safeguard our EU exporters.”
Photo credit & article inspired by: Euronews
