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Time to be Open, Sustainable, and Assertive: Tariffs on Chinese BEVs and Retaliatory Measures

Author

Listed:
  • Gabriel Felbermayr

    (Austrian Institute of Economic Research (WIFO)
    Kiel Institute for the World Economy)

  • Klaus Friesenbichler

    (Austrian Institute of Economic Research (WIFO)
    Supply Chain Intelligence Institute Austria (ASCII))

  • Julian Hinz

    (Kiel Institute for the World Economy)

  • Hendrik Mahlkow

    (Austrian Institute of Economic Research (WIFO)
    Kiel Institute for the World Economy)

Abstract

On 12 June, the European Commission announced provisional countervailing tariffs of 21% on battery electric vehicles (BEVs) imported from China. This paper uses a large-scale trade model (KITE) to assess the impact of the tariffs, showing that while short-term effects may be larger, long-term effects are likely to be moderate. BEV imports from China are projected to fall by 42%, with limited impacts on EU car exports. This policy brief also analyzes potential retaliatory measures from China, including tariffs on EU pork exports, and highlights the need for careful negotiation to avoid escalation.

Suggested Citation

  • Gabriel Felbermayr & Klaus Friesenbichler & Julian Hinz & Hendrik Mahlkow, 2024. "Time to be Open, Sustainable, and Assertive: Tariffs on Chinese BEVs and Retaliatory Measures," ASCII Studies 004, Supply Chain Intelligence Institute Austria.
    • Handle: RePEc:bdt:asciis:004
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    References listed on IDEAS

    as
    1. Bickenbach, Frank & Dohse, Dirk & Langhammer, Rolf J. & Liu, Wan-Hsin, 2024. "Foul play? On the scale and scope of industrial subsidies in China," Kiel Policy Briefs 173, Kiel Institute for the World Economy.
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    8. Hinz, Julian & Monastyrenko, Evgenii, 2022. "Bearing the cost of politics: Consumer prices and welfare in Russia," Journal of International Economics, Elsevier, vol. 137(C).
    9. Sonali Chowdhry & Julian Hinz & Katrin Kamin & Joschka Wanner, 2024. "Brothers in arms: the value of coalitions in sanctions regimes," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 39(118), pages 471-512.
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