China is taking the next step in the trade war with the European Union. After an anti-dumping investigation into pork was previously launched, the Asian country is now focusing on dairy. The measure is not an isolated measure, but appears to be a retaliation for European import duties on cheap electric cars from China. The idea is that Europe is disadvantaging Chinese car brands.
The Chinese Ministry of Commerce announced yesterday that it had immediately launched an anti-dumping investigation into imported dairy products from European member states. Initially, the research focuses on various types of cheese, milk and cream intended for human consumption. This means that China is leaving milk and whey powder, which are by far the largest European export flows, out of the picture for the time being. Such an investigation had already been threatened.
The same research is also underway into European pork. This is where China focuses directly to European slaughterhouses such as Vion, Danish Crown and the Spanish Litera. Things are not yet that concrete with dairy, except that the role of 20 of the 27 European member states is being scrutinized. The Netherlands is not mentioned, nor are Germany, France, Spain, Portugal, Hungary and Slovakia.
Electric car
Although not mentioned in so many words by China, the anti-dumping investigations appear to be a retaliation for European import duties on cheap Chinese electric cars. This has been going on for some time and there are new developments. The European Commission announced earlier this week that it would reduce import duties on Teslas made in China over the next five years, from the planned 20,8% to 9%. This new tariff is significantly lower than the tariff imposed on Chinese electric car manufacturers; which range from 17% to 36,3%. Chinese car makers feel severely disadvantaged by this.
The Commission's plan still needs to be approved by the European Parliament.