· 2 min read
illuminem summarizes for you the essential news of the day. Read the full piece on POLITICO or enjoy below:
🗞️ Driving the news: On Wednesday 12th of June, The European Commission published a decision to impose duties of up to 38.1 percent on electric vehicle imports from the beginning of July
• The Chinese Chamber of Commerce expressed “shock, grave disappointment and deep dissatisfaction with this protectionist measure by the [European Commission]”
🔭 The context: The tariffs represent a high-stake gamble by Ursula von der Leyen, considering she requires the backing of both Macron and Scholz, who have opposing views on the duties, to win a second term as the Commission president
• The EU already charges a duty of 10 percent on any foreign-made vehicle, versus China’s 15 percent level, meaning that at their highest, they would approach 50 percent
🌍 Why it matters for the planet: The EU is looking to protect its market share and to cancel out the unfair advantage Chinese carmakers enjoy thanks to generous state subsidies
• The raised tariffs are a bold geopolitical move potentially leading to an escalation of an already tense trade relationship between the EU and China
⏭️ What's next: The provisional duties are due to be confirmed in a vote by EU member states in a few months, and duties collected retroactively from March, starting in November
• It is unlikely that Germany would be able to gather sufficient support to overturn the decision
💬 One quote: The duty call “does not mark a move away from the bloc’s established model of economic efficiency, comparative advantage and open trade,” Economic policy expert Simone Tagliapietra argues. “It really is about leveling the playing field”
📈 One stat: Car models made by BYD face a 17.4 percent mark-up, with Geely seeing 20 percent and SAIC the highest of 38.1 depending on the results of the Commission inspection earlier this year
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