China, EU close to EV tariff deal, state media says, dismisses ‘trade diversion' fears

South China Morning Post

a day ago

China and the European Union have largely finalised the 'technical' part of negotiations towards resolving their electric vehicle (EV) tariff dispute, with the deal now hinging on 'political will' from the European side, according to Chinese state-affiliated media.
Yuyuan Tantian, a social media account linked to state broadcaster CCTV, reported on Friday night that the 'technical negotiations' were essentially complete, with only the 'final step' remaining. 'The key now depends on whether the EU can demonstrate the necessary political will to push for a resolution of the issue,' it said.
Meanwhile, state news agency Xinhua in a commentary on Saturday dismissed claims of a new 'China shock', describing fears that Chinese exports deflected by US tariffs were
flooding Europe as 'grossly overstated'.
In April,
China and the EU agreed to negotiate a 'price undertaking' mechanism that would allow Chinese EV makers to avoid tariffs by adhering to minimum export prices. The dispute centres on EU tariffs of up to 45.3 per cent imposed last October on Chinese EVs, to counteract what Brussels sees as an unfair edge enjoyed by Chinese manufacturers due to huge state subsidies and lower production costs.
The reported progress in the talks comes ahead of a critical EU-China summit that is expected to primarily focus on trade issues. EU leaders led by European Commission President Ursula von der Leyen
are expected to visit Beijing later this month as the two sides mark 50 years of diplomatic ties.
Over the past two years, the EU has persisted in challenging Beijing on trade issues, including subsidies, alleged dumping and other practices that 'distort the market', with numerous investigations either ongoing or at the planning stage.