On Saturday (May 25), Italian Minister of Economy and Manufacturing Adolfo Urso stated that the European Union should follow the example of the United States by imposing tariffs on Chinese products to protect its own industries.
During the Trento Economic Festival, Urso, when asked whether Europe should follow the United States in imposing tariffs on Chinese imports, responded, “Yes. This is inevitable and must be done quickly. Otherwise, our industries will be swept out.”
“If we do not want the European industry to be eliminated, it is inevitable to impose higher tariffs on Chinese products,” Urso said.
President Biden announced this month a significant increase in tariffs on a range of Chinese imports, including electric cars, batteries, computer chips, and medical products.
Biden also maintained the tariffs implemented during the Trump administration and increased tariffs on other Chinese goods, including quadrupling the tariffs on electric cars to over 100% and doubling the tariffs on semiconductors to 50%.
Urso specifically mentioned the automotive industry, stating that the significant increase in U.S. tariffs could lead to China redirecting exports to Europe, thus harming EU industries.
China’s main export destination for electric vehicles is currently EU countries, with tariffs in the EU ranging from 5% to 10%. Over the past three years, China’s exports of electric vehicles to Europe have surged by 851%.
Joseph Webster, a senior researcher at the Atlantic Council, commented that the latest U.S. tariffs on Chinese electric cars and other goods, including semiconductors and batteries, could compel the EU to take action. Due to the U.S. raising tariffs, China may shift most of its trade to Europe. The EU must act swiftly, either by imposing its own tariffs or accepting a large number of Chinese manufactured products.
The European Commission began an investigation last October into whether Chinese electric cars benefited from “illegal subsidies.” If conclusive evidence is found, the EU can implement anti-subsidy tariffs, with rates exceeding 10%. In early March this year, the European Commission stated that “sufficient evidence” had been found that electric cars imported from China received subsidies, including direct fund transfers, tax exemptions, or providing goods or services at below market prices.
According to EU regulations, the investigation should be completed within 13 months, meaning that the EU could impose provisional tariffs before July and final tariffs by November.
Urso called on the EU to adopt stronger industrial policies as the European Parliament elections are approaching next month. He also explained how the next European Commission will need a “firm industrial policy based on shared resources to protect businesses.”
“I firmly believe that we will achieve the goal of producing 1 million cars in Italy with Stellantis,” Urso later stated. “I think discussions will be concluded in a few days, and I hope we are in the final stages.”
“I believe that this year we will be able to announce an investment of at least 10 billion euros in the field of microelectronics in Italy,” he later announced.