This episode contains segments on:
- EU and China agree to talks on potential EV tariffs;
- China to limit low-end capacity in the solar industry;
- Foreign direct investment from January to May 2024;
- New measures to boost consumption;
From the Chamber’s side, the latest issue of EURObiz is released and available to download.
Contact:
We’d love to hear your feedback. Contact us at website@europeanchamber.com.cn.
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Read more:
EU and China agree to talks on potential EV tariffs
http://www.mofcom.gov.cn/article/xwfb/xwbldhd/202406/20240603518155.shtml
http://www.mofcom.gov.cn/article/xwfb/xwbldhd/202406/20240603518157.shtml
https://www.ft.com/content/9902c9f2-3664-4a23-a5a5-77bca4979d96
China to limit low-end capacity in the solar industry
http://www.nea.gov.cn/2024-06/20/c_1310779045.htm
January to May 2024 FDI (MOFCOM)
http://www.mofcom.gov.cn/article/xwfb/xwsjfzr/202406/20240603517966.shtml
New measures to boost consumption (NDRC)
https://www.ndrc.gov.cn/xwdt/tzgg/202406/t20240624_1391293_ext.html
EURObiz May/June 2024 edition:
https://www.europeanchamber.com.cn/en/eurobiz-magazine
Transcript:
XINHE: Hello and welcome to China ShortCuts,
RUI: the European Chamber’s weekly catchup on China’s business landscape.
XINHE: This episode was recorded on 26th June 2024.
(MUSIC)
XINHE: China and the EU have agreed to start talks over planned tariffs of up to 48 per cent on electric vehicles exported from China into Europe. The talks were announced on the sidelines of German Vice Chancellor Robert Habeck’s three-day trip to China.
RUI: Habeck argued that the EU’s approach to tariffs was not a “take it or leave it” situation, but rather open to change through dialogue. At a press conference held on 22nd June, the vice chancellor referred to the potential escalation of tariffs and counter tariffs as a “dangerous development,” telling reporters, “I hope nobody in Europe wants the tariffs.”
Habeck also held separate meetings with the National Development and Reform Commission and the Ministry of Commerce. Commerce Minister Wang Wentao, while welcoming the EU’s offer for talks, called the tariffs a “typical protectionist measure” aimed at supressing the development of Chinese companies.
After the meeting, Wang Wentao and EU Commissioner Valdis Dombrovskis agreed to launch negotiations over the electric vehicle tariffs, according to an announcement on the Ministry of Commerce’s website.
(MUSIC)
XINHE: The National Energy Administration announced that it would take steps to limit low-end capacity in the solar energy industry following a call from a consortium of domestic companies for greater government involvement in the sector.
RUI: The surge in capacity has driven down the price of components and squeezed the profits of solar manufacturers, which could lead to bankruptcies in the industry. At a press conference on 20th June, the director of the new and renewable energy sources department at China’s energy regulator announced that the NEA will take several measures to guide the development of the solar industry. The measures include promoting the construction of a new energy infrastructure network and improving the grid’s ability to accept, configure and regulate electricity generated from new energy sources.
The European Chamber’s Business Confidence Survey shows that limited access to renewables is reported by 62% as the top challenge to decarbonising their operations in China. Its Energy Working Group noted that China’s west-east electricity transfer project is currently limited by the transmission line capacity. In addition, western provinces need to satisfy their own Renewable Portfolio Standard (RPS) first before delivering renewable electricity to eastern cities. The RPS mechanism sets mandatory renewable and non-hydro renewable consumption targets at the provincial level.
(MUSIC)
XINHE: Data disclosed by the Ministry of Commerce showed that China’s actual use of foreign direct investment in the first five months of 2024 fell more than 28 per cent year-on-year.
RUI: China attracted 412-billion-yuan worth of foreign direct investment from January to May 2024. The decline accelerated from the first four months of the year. A breakdown of the data indicated that over a quarter of FDI in the first five months of the year was utilised in the manufacturing sector. Actual foreign investment from Singapore increased by more than 16 per cent, while FDI from Germany increased by more than 24 per cent.
After releasing the data, the Ministry of Commerce explained that the decline was a result of the fact that FDI had fallen from a high baseline at the beginning of 2023. At the same time, the Ministry emphasised that China would continue to improve the business environment, including through implementation of the August 2023 24 measures, which are aimed at improving China’s ability to attract foreign investment.
The Ministry of Commerce further noted that over twenty-one thousand new foreign invested enterprises were set up in the first five months of the year, a 17.4 per cent increase from the same period in 2023.
(MUSIC)
XINHE: The National Development and Reform Commission (or, NDRC) released a series of measures to spur domestic consumption on 24th June.
RUI: The measures include policy adjustments across six areas, including catering, tourism, retail, bulk commodities, healthcare, and community convenience services. Among the adjustments related to tourism, the NDRC promoted several measures for making inbound tourism more convenient. Specific policies include optimising entry and exit procedures, promoting the acceptance of foreign bank cards, and making it easier for foreign nationals to purchase tickets and make hotel reservations.
As supply-side policies continue to contribute to the trade imbalances that China has accumulated with the EU and the US, the European Chamber has argued that stimulating consumption and providing support to the demand side is important for getting China’s economy back on track, while reducing tensions with its trade partners.
(MUSIC)
XINHE: The latest issue of the Chamber’s bimonthly magazine EURObiz explores a number of areas relevant to European businesses’ operations in China. Featured articles delve into topics such as the European Union’s risk management measures and the origins of the term “de-risking”.
RUI: The May/June edition of EURObiz is now available to download for free from the Chamber’s website.
(MUSIC)
XINHE: Thanks for listening, and don’t forget to tune in again next week.
RUI: In the meantime, please find useful links in the episode notes.