Euro Commission Challenges China’s Anti-Subsidy Investigation on EU Dairy Exports
In a bold move, the European Commission has fired back at China’s anti-subsidy investigation targeting some of the bloc’s dairy exports, slamming it as based on “questionable allegations and insufficient evidence” and demanding its immediate cessation.
The Commission’s announcement sets the stage for potential consultations at the World Trade Organization (WTO) to resolve the conflict before it spirals out of control.
The Chinese probe, initiated at the behest of two state-backed industry groups and launched by the Commerce Ministry in late August, specifically focuses on EU subsidies related to fresh and processed cheese, blue cheese, and other dairy products. Eight member states, including Austria, Belgium, and Italy, have come under China’s scrutiny in this investigation.
This move is widely viewed as retaliatory, coming shortly after the Commission’s proposal to impose additional tariffs of up to 36.3% on Chinese-made electric vehicles (EVs) following a lengthy inquiry.
Brussels has accused Beijing of providing unfair subsidies to its EVs, distorting competition and hindering European companies in the market. The proposed tariffs aim to level the playing field between EU and Chinese EV manufacturers.
Chinese officials have vehemently rejected these claims, labeling the Commission’s actions as protectionist and exaggerated. China has reciprocated by launching investigations into sensitive EU exports like dairy, pork, and brandy, sparking concerns of an impending trade conflict.
Despite the public disagreements, behind closed doors, Beijing is seeking a negotiated resolution to the EV dispute to shield its companies from hefty tariffs. A recent meeting between Valdis Dombrovskis, the EU’s trade chief, and China’s Minister of Commerce, Wang Wentao, failed to yield a breakthrough but signaled a commitment to further discussions.
With tensions persisting, the Commission’s latest statement emphasizes its determination to challenge China’s actions and safeguard the Common Agricultural Policy (CAP), a crucial subsidy program for EU farmers.
“The Chinese investigation on EU dairy is based on questionable allegations and insufficient evidence, therefore we will continue to challenge it vigorously in all available venues, while calling on China to bring it immediately to an end,” declared Dombrovskis.
This marked the first time the EU has sought WTO consultations at the initial stage of an anti-subsidy investigation.
The European Dairy Association (EDA) applauded the Commission’s stance, highlighting the additional burdens faced by dairy producers due to the Chinese probe.
“For European cream and cheese, we’re once more a ‘hostage’ of a non-related trade dossier,” voiced Alexander Anton, EDA’s secretary general. “We count on the EU Commission to ensure that we will not become collateral damage in the trade tensions with China.”
In 2021, the EU’s dairy exports to China totaled €1.76 billion, a decrease from €2.08 billion in the previous year, with Ireland leading the pack among member states. – Euronews
