The Chinese Commerce Ministry announced today it will investigate subsidies provided by the EU and some of its member countries for dairy products, which could lead to tariffs on their export to China. The move comes a day after the EU released a draft decision on finalizing tariffs on electric vehicles, or EVs, made in China. (AP)
Our Take
China’s decision to launch this investigation marks just the latest escalation in its trade war with the EU. The trade tensions between the two have been simmering for some time, but took a decisive turn in June, when the EU announced tariffs on Chinese-made EVs after a monthslong anti-subsidy investigation. As we wrote back then, that move signaled Brussels’ decision to move closer to Washington’s protectionist approach to Chinese competition.
The EU’s decision was always going to draw the Chinese government’s ire. And indeed, starting with the initial announcement of the EU’s anti-subsidy investigation last year, Beijing has itself announced a tit-for-tat move against EU industries with each new development.