EU singles out China, trade guide retains focus on key sectors

The European Commission has released a revised report on state-led distortions within the Chinese economy, expanding its scope to include additional sectors. This move may allow EU chip and clean-tech producers to file anti-dumping complaints.

Published on March 10, 2024, the updated report is 712 pages long and provides intricate insights into what the EU executive identifies as distortions across the telecom equipment, semiconductor, rail, renewable energy, and electric vehicle industries. The aluminium, steel, chemicals, and ceramics sectors remain unchanged from the initial 2017 report. There isn't a comparable EU report for any other nation.

The report serves as a resource for EU industries to lodge complaints regarding dumping practices. Should it be determined that prices and costs from China are distorted, they may be substituted with those from another country to calculate higher dumping tariffs accurately.

On an annual basis, the Commission typically initiates around ten anti-dumping inquiries, frequently focusing on steel goods. Presently, it aims to safeguard EU enterprises from inexpensive, clean-tech items. This involves scrutinizing subsidies provided to Chinese wind turbine manufacturers and conducting an anti-subsidy probe into the influx of Chinese electric vehicles.

However, this report will not be a factor in these investigations, as it solely addresses dumping.

The report delves into the role of the Chinese state in strategising to achieve economic objectives, emphasising the significance of state-owned enterprises, preferential access to land, labour, raw materials, and energy, and state backing for specific sectors.

The report highlights Chinese overcapacity across various sectors, such as electric vehicles.

In March, China's parliament, the National People's Congress, announced that the government would take measures to tackle overcapacity. Beijing contends that the recent focus by the U.S. and EU on the risks stemming from China's excess capacity is misguided. Its state media has criticised these concerns as attempts to hinder China's ascent.