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China expresses ‘strong dissatisfaction’ with EU’s anti-subsidy probe into Chinese electric cars

A Nio ET5 is displayed at a Chinese electric cars exhibition in Shanghai, China, on February 3, 2023. (Photo by Reuters)

China has strongly criticized the European Union's planned probe into Chinese electric cars with the alleged goal of finding out if their prices are kept low as a result of state subsidies provided to their producers.

The European Commission, the EU's executive arm, announced the probe earlier in September, claiming that the cars’ prices are kept “artificially” low as a result of Beijing's subsidies. Upon conclusion of the investigation, which the commission has 13 months to complete, it will decide whether to subject Chinese electric car imports to tariffs above the bloc's standard 10-percent rate for cars.

Speaking on Monday, Chinese Vice Premier He Lifeng voiced his country's “great concern and strong dissatisfaction” about the EU’s anti-subsidy probe.

"China again expressed great concern and strong dissatisfaction with the issue of the EU’s launch of an anti-subsidy probe into Chinese electric vehicles. We hope the EU would exercise caution and continue to keep its market free and open," the Chinese official said at a news conference following a high-level economic and trade dialogue with visiting EU Executive Vice President Valdis Dombrovskis.

“China is ready to expand imports from the EU, and hopes that the EU will cancel restrictions on its export of high-tech products to China,” he said, adding, “This benefits European consumers, benefits green and low-carbon development of Europe, and benefits global climate change cooperation.”

The anti-subsidy probe covers battery-powered cars from China, including non-Chinese brands made there such as Tesla, Renault, and BMW.

Analysts have called it “strange” that the European Commission has chosen to initiate such an investigation itself instead of launching it in response to industry complaints.

On September 15, China's Global Times newspaper described the probe as “excessive” and unfairly “jealous.”

The matter constitutes the highest profile case against China since an EU probe into Chinese solar panels narrowly avoided a trade war a decade ago.

Dombrovskis, for his part, said the two sides had “insightful” discussions and agreed to resume “regular exchanges to discuss macroeconomic issues” in the coming months.

Referring to the EU’s trade deficit with China, he said the two sides “agreed to continue discussions on a possible EU-China transparency mechanism on supply chains for raw materials.”

Reports of the probe came after EU leaders expressed concern about the bloc's growing trade deficit with China, which reached 396 billion euros last year.

“Addressing these concerns will help China retain its capacity to attract and retain foreign investment and meet its objective of sustainable, high-quality economic development,” he said.

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