Divided we stand: The EU votes on Chinese electric vehicle tariffs
The EU vote in favour of tariffs on Chinese electric vehicles has exposed divisions across EU member states on how to approach the challenges that China’s economic rise pose
On 4 October EU member states voted in favour of imposing tariffs of up to 45 per cent on Chinese electric vehicles for at least five years. The topic was highly contentious: 10 member states supported the measure, 12 abstained, and another 5 voted against the tariffs. Unless a last-minute compromise is found, the tariffs will go into effect.
The vote is about much more than Chinese cars, especially as many Chinese EV-makers should be able to absorb the impact of the tariffs by reducing their fat margins. The respective positions of various EU member states illustrate how European countries remain divided on how to tackle the challenges that China’s economic rise pose. Looking ahead, European fragmentation could play into China’s hand by preventing the emergence of bolder European policies vis à vis Beijing.
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EU votes on big issues are rarely jaw-dropping. Non-binding polls typically act as rehearsals before the big day, meaning that the positions of member states are usually well-known by the time of the vote. This time was different. After initially abstaining in the non-binding poll on 15 July, Germany voted against the tariffs after German chancellor Olaf Scholz used his executive powers to force his coalition partners into voting “no”. His move was partly due to aggressive lobbying from German car manufacturers; many of them believe tariffs could lead to Chinese retaliation against German-made car exports to China or even jeopardise German investments on Chinese soil.
With its “no” vote, Germany has further cemented its status as the most Beijing-friendly of the large EU member states. The country was the only one among the bloc’s six biggest economies to vote against the measure. Berlin is now the main roadblock to the adoption of bolder EU policies vis à vis China. Across the Atlantic, Berlin’s stance will also make US policymakers even more sceptical about EU plans to “de-risk” – or reduce their economic reliance – from China.
Germany’s position puts the country at loggerheads with France, which has recently adopted a much more hawkish position towards China and voted in favour of the tariffs. Berlin’s growing isolation and row with its most important partners will be music to the ears of Chinese policymakers. Beijing has long made dividing Western allies a priority in a bid to prevent the emergence of bolder European policies or even joint US-EU measures, such as export controls on critical technology, on China.
Looking beyond big EU member states, the vote also illustrated Chinese efforts to court smaller EU economies. Hungary serves as a prime example of this. In 2023 the country captured nearly half of the Chinese foreign direct investment (FDI) on European soil, with inflows larger than those to Germany, France, and the United Kingdom combined. Unsurprisingly, Budapest voted against the tariffs, which Hungarian prime minister Viktor Orban said could fuel an “economic cold war.” Beijing may see Budapest’s vote as proof that doubling down on FDI is the best plan to gain favours from some EU member states.
Talking about making friends, the failure of China’s arm-twisting efforts with Spain and Ireland will serve as further proof for Beijing that cajoling EU member states is a more powerful strategy than blackmailing them. After much hesitation, Spain abstained from the vote despite Chinese threats to cut down on imports of Spanish pork products. A similar scenario unfolded with Ireland, which voted in favour of the tariffs despite Chinese threats of curbing Irish dairy imports.
Germany and Hungary fall at the friendliest-towards-Beijing side of the wide spectrum of EU stances on China. Poland and the Baltic countries are at the other end, and they all voted in favour of the tariffs. Part of the explanation for their hawkish position lies far away from Beijing. These countries are the most hardline EU member states towards Russia. Their views appear to influence their stances on Beijing in light of an increasingly emboldened Russia-China axis. Beijing’s unwillingness to curb Chinese firms’ shipments of dual-use goods (products that have both civilian and military applications) to Moscow is a key reason behind such concerns. Looking ahead, it is likely that more member states will see the Russia and China questions as deeply intertwined and adopt coherent positions on both issues.
Instead of fostering the development of coherent EU positions towards China, such a situation risks further fuelling EU fragmentation on China. Many EU member states have reservations over the effectiveness of sanctions against Russia or the need to offer more support to Ukraine. This is especially true for typically Russia-friendly southern European member states, such as Greece, Cyprus, and Malta. All have abstained from the vote and will probably be the target of intense Chinese wooing in coming months in a bid to sow further dissent among EU member states on the China and Russia questions.
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Fragmentation is often the best word to describe EU stances on many issues. Some EU member states are deeply worried about China’s economic rise and support for Moscow. Meanwhile, others have no industrial interests at stake, or simply want to retain access to cheap green goods. The EU vote in favour of tariffs on Chinese electric vehicles was not a watershed moment of European boldness vis à vis Beijing. Instead, it illustrated how the bloc remains fragmented on how to approach its relations with Beijing. The EU’s path forward with China will likely remain a bumpy one. That would be good news for Beijing.
The European Council on Foreign Relations does not take collective positions. ECFR publications only represent the views of their individual authors.