With EU tariffs and the US rivalry, will China be battling 2 trade wars at once?

Chinese exporters are facing tougher conditions abroad and only set to get worse, analysts say

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Chinese EVs face higher tariffs in the European Union. Photo: AP

Published: 10:00am, 1 Nov 2024Updated: 10:32am, 1 Nov 2024

China could soon be battling trade wars on two fronts, with Europe pushing ahead with big tariffs on Chinese electric cars and a deepening contest looming with the US.

The double crunch could still be avoided but conditions were only to get tougher for Beijing, according to analysts.

The European Union’s tariff increases on Chinese-made electric vehicles took effect on Wednesday after months of negotiations with China fell through.

A top rate of 35.3 per cent will apply to EVs from Chinese-state owned SAIC Motor and its subsidiaries, on top of a baseline 10 per cent duty that applies to all EV imports, which by some estimates account for about 2 per cent of total trade value between China and the EU.

China responded to the decision by filing a complaint with the World Trade Organization, saying it would take “all necessary measures to resolutely safeguard the legitimate rights and interests of Chinese companies”.

In Beijing on Tuesday, Finnish President Alexander Stubb said he was concerned that there would be a cycle of escalating tariffs.

“We need to avoid that. We need to have a level playing field,” Stubb said.