EU-China trade talks are in a good position following the recent agreement on the export of hybrid vehicles to Europe, but challenges still remain. Panelists at the summer summit in Brussels emphasized that this agreement is a positive step towards improving trade relations.
Agreement to Reduce Hybrid Vehicle Exports
Linlin Liang from the China Chamber of Commerce in the EU assessed this agreement positively from a business perspective and described it as "balanced." The main agreement was that China's exports of hybrid vehicles to Europe would be reduced by half, which was announced by Maroš Šefčovič, the EU Trade Commissioner, as the main outcome of these negotiations.
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Planning for Future Negotiations
Šefčovič has planned to hold further talks with Wang Wentao, the Chinese Minister of Commerce, in January, and they will meet again in March. His goal is to reduce the €1 billion daily trade deficit. Liang also noted that China is prepared to take action if negotiations do not progress.
Kathleen Van Brempt, a Belgian parliament representative from the Socialist and Democrats group, stated that an important outcome of the negotiations in Beijing has been "a kind of trade agreement." However, China's aggressive subsidy policies remain a significant barrier, as OECD studies show that China's subsidies to industry are up to eight times more than those of other countries.
Liang emphasized that China's export success is not solely related to subsidies but is the result of decades of investment in innovation. He also stated that Chinese companies have a strong desire to invest in Europe, but they need to assess the profitability of the EU market.
This discussion also revealed disagreements among policymakers and businesses regarding the EU's "Industrial Accelerator" law. Van Brempt mentioned that three main parliamentary representatives are in agreement on this issue, while the European People's Party is "very divided" on it. She added that representatives need to reach a common position.
Additionally, the "Made in Europe" clause of this bill has raised concerns for the industry, as it may isolate the EU from global supply chains. Holger Wintreit, a representative of the German pharmaceutical company Bayer, warned that isolation should be avoided and reliable global partnerships should be sought.
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