What is the intention behind China's sudden imposition of temporary anti-subsidy measures on imported dairy products from the EU? Is it merely because the EU provides subsidies to these dairy products, leading to unfair competition? Will the EU's threat to file a complaint with the World Trade Organization (WTO) be effective?

On Monday, the Chinese Ministry of Commerce issued a notice stating that due to subsidies on imported dairy products from the EU, China has decided to impose temporary anti-subsidy measures on such products starting December 23, with ad valorem subsidy rates ranging from 21.9% to 42.7%.

European industry representatives stated that French producers would be most affected by China's move, and the French Dairy Federation called it a "shocking act." The EU Commission's trade spokesperson, Gill, said that "China's measures are unreasonable and baseless" and emphasized that the EU Commission has filed a complaint with the WTO, will assess the latest measures according to WTO regulations, and that China's measures have had a "very negative impact" on Sino-EU relations.

French Dairy Products

Media outlets such as Reuters and Bloomberg believe this is part of a series of new measures taken by China against EU exports, generally seen as a response to the EU's tariffs on Chinese electric vehicles.

In 2023, the European Commission launched a so-called "anti-subsidy investigation" into Chinese electric vehicles, and in October 2024, it officially imposed tariffs. In response, China stated that "to safeguard its legitimate rights and interests, it will take all necessary measures."

Viewed in this light, China's action against dairy products from the EU is likely a retaliation against the EU's tariffs on Chinese electric vehicles. After all, the EU's actions have already constituted "trade protectionism" and have substantially harmed the interests of Chinese companies. China cannot remain indifferent and must seek justice.

EU

As for why the dairy sector was chosen, I think it relates to the relatively moderate trade volume between China and the EU. In the first 10 months of this year, out of 156,000 tons of cheese imported by China, 14.5% came from the EU, while New Zealand accounted for more than 60%.

The EU's exports of dairy products to China are relatively moderate. China's punitive measures can ensure that New Zealand and domestic enterprises fill the gap, while also making the EU feel "pain." More importantly, if the EU wants to avoid losing market share to New Zealand or Chinese domestic enterprises, it must quickly make decisions on the tax issue of electric vehicles in China. The longer it delays, the worse it will be for them.

Additionally, by choosing a moderately sized dairy trade for countermeasures, China actually highlights another meaning: if the EU does not correct its mistakes, the scope of countermeasures could expand to other areas, such as French brandy, which are all suitable for countermeasures.

Chinese Electric Vehicles Going Global

In short, China's countermeasure logic is to use a blunt knife to cut flesh, gradually increasing the pain felt by the EU until it is willing to correct its mistakes and stop the suppression and restrictions on Chinese electric vehicles entering the European market.

However, even if the EU files a complaint with the WTO, China's countermeasures will not stop. In fact, the EU's tariff on Chinese electric vehicles violates the logic of "free trade." I don't believe the EU can cause much trouble.

Moreover, the West has always emphasized the nature of "survival of the fittest" in this world. Therefore, strength is the basis for setting rules. Given China's current strength, even if the WTO does not recognize China's countermeasures, it may not be enough to stop China.

World Trade Organization

It is the EU that needs to deeply reflect: can "trade protection" policies save its electric vehicle industry? It should understand that compared to European competitors, Chinese electric vehicles have almost overwhelming advantages, which is the fundamental reason for their popularity in the global market.

If Europe is "not as good," they should learn from China and promote local car manufacturers to accelerate their transformation and compete with Chinese manufacturers in a healthy way, rather than using methods to block Chinese electric vehicles from entering the European market. This approach benefits Europe nothing and only further widens the gap with China.

Original: toutiao.com/article/7586878281375416884/

Statement: The article represents the views of the author.