China threatens retaliation against EU as trade dispute widens

Industry News | | MIC Customs Solutions |

Chinese media have raised the prospect of retaliatory tariffs on EU goods if Brussels continues its probes into Beijing's trade practices.


Exports of European products, such as beverages, to China could be hit by new tariffs if Beijing takes retaliatory measures as part of an ongoing trade dispute with the EU, it has been reported.

Bloomberg stated that Yuyuan Tantian, a social media account linked to China’s state media, recently posted that the country's government will “very likely have to take a series of measures to hit back" if EU investigations into alleged unfair trade practices continue.

While the post did not specify what categories may be affected, it did observe that the EU is reliant on China for exports of items such as wine, dairy and aircraft.

The Chinese Chamber of Commerce to the European Union has issued a similar warning, saying that “European wine and dairy products may find themselves caught in the crossfire”.

Brussels has been investigating the impact of Chinese state subsidies in a number of sectors and is expected to unveil tariffs on products such as electric vehicles and solar panels later this year.

In response, China has opened its own investigation into alleged dumping of chemicals by the EU, while earlier this year, it launched an anti-dumping probe into EU liquors including cognac - an issue that came up during President Xi Jinping's recent visit to France.

Bloomberg noted that if past events are any guide, food and drink are likely to be among the key imports targeted by tariffs or other trade barriers. It was observed that previously, Beijing has imposed restrictions on Australian wine and barley, fruit from the Philippines and Norwegian salmon in response to economic and political disputes.

Meanwhile, Drinks Business suggested that such moves could jeopardize the $800 million-a-year wine trade between the EU and China, which accounts for almost 70 percent of Beijing's imports in the sector.

Producers in France, Spain, Italy, Germany and Portugal would be most affected, with French vineyards alone currently making up around half of EU wine exports to China.