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EU prepares to impose tariffs of up to 45% on Chinese electric cars

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Brussels argues that tariffs of up to 45% are necessary to counteract what it calls Beijing’s “harmful” subsidies.

The tariffs, which took effect on Wednesday and will remain in place for five years, follow the EU’s dismissal of China’s accusations that it imposed protectionist measures without evidence of “undue state support” for Chinese vehicles.

These new tariffs add to the EU’s existing 10% tariff on car imports from China. Both sides indicated they would continue discussions, potentially introducing a “minimum price” for Chinese-made cars sold in Europe.

An EU official told the Financial Times (FT) that this minimum price level should be high enough to offset the “damaging subsidies” Chinese manufacturers receive, which allow them to undercut their European competitors.

China’s Ministry of Commerce said on Wednesday that Beijing would “continue to take all necessary measures to resolutely safeguard the legitimate rights and interests of Chinese enterprises.” The ministry also expressed hope that Brussels could work “constructively” with Beijing to resolve the dispute through dialogue.

The EU’s decision to impose additional tariffs on Chinese-made electric vehicles follows a months-long investigation initiated last year by European Commission President Ursula von der Leyen into alleged unfair support for China’s electric vehicle industry.

Beijing has repeatedly criticized Brussels for the investigation and tariff hikes, arguing that Europe’s actions violate international trade rules and jeopardize global progress in combating climate change.

The tariffs have sparked significant division within the EU, with strong opposition from member states including Germany and Hungary. Diplomats warn that EU countries exporting to China are preparing for potential retaliatory measures from Beijing. This move also comes at a sensitive time for the EU car industry, which is already struggling to compete with the growing presence of low-cost Chinese electric vehicles in the bloc.

All major European carmakers, except Renault, have issued profit warnings this year. Volkswagen, Europe’s largest carmaker, plans to close at least three German plants and cut thousands of jobs as part of a cost-reduction strategy.

In addition to high energy costs and strict regulations tied to the EU’s green transition, the industry is grappling with a sharp increase in more affordable Chinese models entering the market.

The Commission emphasized that the tariffs were introduced to ensure a “level playing field” in Europe, rather than to restrict trade with China. The tariffs, first announced in June, vary from 7.8% for Tesla to 35.3% for SAIC, depending on the subsidies each company received from Beijing. China’s BYD and Geely are also affected.

Other manufacturers that cooperate with Brussels by providing required information will face a tariff of 20.7%, while those who do not cooperate will be subject to a 35.3% duty.

“We can safely say that we fundamentally disagree with every single fact and every single legal argument put forward in the investigation,” an EU official stated.

China has announced it will impose anti-dumping measures on EU spirits imports and has launched investigations into EU pork and dairy imports in response to the EV tariffs.

Beijing also filed a complaint with the World Trade Organization (WTO) following the preliminary tariff announcement, labeling the investigation as “protectionist” and alleging a lack of “concrete evidence” of subsidies in China.

The EU responded that the WTO complaint was now moot, as the tariffs were slightly reduced following the investigation. The Chinese Chamber of Commerce in the EU told the Financial Times it was “deeply disappointed” by the Commission’s decision to uphold tariffs, stating that it was “disheartening that no significant progress has been made in negotiations.”

However, an EU official noted that prices for consumers might not rise immediately: “If a consumer buys a car now, there’s a very good chance they’ll buy it from stock already available in the EU market,” the official said.

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EU states hold talks with Taliban in Brussels on Afghan returns

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Representatives from 15 European Union member states met with the Taliban in Brussels on June 23 to discuss the return of Afghan nationals to Afghanistan.

A European Commission spokesperson said on Tuesday that the meeting was co-chaired with Sweden. Belgium and the Netherlands also took part.

The Commission stressed that the discussions primarily focused on the return of Afghan citizens with criminal records or those considered security threats.

Talks covered a wide range of issues, including the identification of returnees, the issuance of travel documents and procedures related to their repatriation.

However, Johannes Luchner, a senior European Commission official who travelled to Kabul in January, had previously indicated that the scope could extend beyond convicted individuals.

Addressing European lawmakers at the end of January, he said: “Our primary concern is the return of criminals, but the number of non-criminal Afghans who have received return orders is also increasing.”

Another EU source has now expressed a similar view. Speaking to EUobserver on Tuesday ahead of the meeting, the source said the discussions would also cover the return of asylum seekers whose applications had been rejected.

Earlier in the day, the Commission declined to provide details about the meeting.

As a result, questions remained unanswered regarding who covered the Taliban delegation’s travel expenses, where the meeting would take place, whether women would participate and what the Taliban expected in return for assisting the EU with deportations of Afghan nationals.

The EU and its member states have not recognised the Taliban government since it returned to power five years ago.

Brussels defended its decision to maintain limited contacts with Afghanistan’s “de facto authorities,” arguing that such engagement is necessary to facilitate the deportation of rejected asylum seekers who have committed crimes or are considered dangerous.

A European Commission spokesperson said officials from the Commission and 15 EU member states attended the Brussels meeting, which followed a previous gathering held in Kabul in January.

“The Commission services and Sweden today co-chaired a technical-level meeting in Brussels together with technical-level representatives of Afghanistan’s de facto authorities responsible for return and readmission matters,” the spokesperson said.

A spokesperson for Afghanistan’s Foreign Ministry said the agenda was broader and included the possibility of a future consular presence in the EU, the resumption of consular services for Afghans living there and “the need for confidence-building measures.”

Spokesperson Abdul Qahar Balkhi added that the meeting raised hopes of creating “positive momentum to safeguard the consular rights of Afghans residing abroad.”

According to a European Commission letter addressed to Balkhi and reviewed by Reuters, the discussions would focus on “the return and readmission of Afghan nationals without a right to reside in the EU.”

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EU defence chief calls for integration of Ukraine’s military into European defence architecture

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The European Union’s Defence Commissioner, Andrius Kubilius, said the bloc should integrate Ukraine into a future European defence union, speaking at the European Defence and Security Summit in Brussels.

According to remarks reported by Reuters, Kubilius said: “It would be difficult to make sense of things if we did not regard the integration of Ukraine’s armed forces into our defence architecture in Europe as a vital issue.”

Kubilius stressed that Ukraine currently holds a dominant position on the battlefield thanks to the transformation of its military doctrine.

Calling for the integration of Europe’s defence industry and Ukraine’s manufacturing facilities into a single military structure, Kubilius said Ukraine should be fully integrated into the EU’s military market.

He added that the European Commission could present a detailed analysis of the defence market and initial proposals for next steps as early as next week.

At a later stage, the commissioner said, the Commission would propose changes to defence procurement rules and other market regulations.

Kubilius also outlined a strategic objective for the European Union.

He argued that EU member states should spend around €7 trillion on arms production over the next decade in order to surpass Russia in military strength and weapons stockpiles. According to Kubilius, such spending would be consistent with commitments under NATO to raise defence budgets to 5% of gross domestic product.

Urging Europeans to be prepared to bear the cost, Kubilius described it as “the price of peace.”

At the same time, he suggested moving away from the production of highly sophisticated weapons that are difficult to manufacture in large quantities. Instead, citing the example of drones used in Ukraine, he called for a focus on producing “enormous quantities of satisfactory weapons.”

The EU Defence Commissioner also underscored the need to integrate Ukraine’s innovative defence industry into Europe’s broader defence and technological base.

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Hungary blocks joint EU letter backing Ukraine and Moldova accession process

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Hungary has refused to endorse a joint letter intended to be sent on behalf of all 27 European Union member states to the European Council and the European Commission in support of Ukraine’s and Moldova’s accession to the bloc.

According to Politico, citing sources familiar with the matter, the letter is required for Kyiv’s and Chisinau’s membership applications to advance to the next stage of the accession process.

The sources said Hungary was the only member state that declined to back the document. Because approval requires the consent of all 27 member states, the issue is expected to be revisited next week.

Hungary, which previously blocked Ukraine’s accession negotiations for an extended period, was led at the time by Prime Minister Viktor Orban. His successor, Prime Minister Peter Magyar, has not opposed the launch of the negotiation process but has insisted on removing the phrase “as soon as possible” from the draft letter’s reference to Ukraine’s accession.

Magyar said Hungary does not support opening all negotiating chapters simultaneously in an effort to accelerate Ukraine’s membership bid.

Explaining the government’s position, he said: “Partly because the ink on the documents relating to the first chapter has barely dried, and partly because this would send the wrong message to Western Balkan countries such as Serbia, Albania, Montenegro and North Macedonia, which have been working for years to become members of the European Union.”

The European Union formally opened the first chapter of accession negotiations with Ukraine and Moldova in June. The process was launched during a ceremony in Luxembourg attended by the foreign ministers of member states and is divided into six thematic clusters covering different areas of legislation and policy.

The opening of the first cluster, which covers core issues including the rule of law, the functioning of democratic institutions and public administration, marks the transition from the preparatory phase to practical work on meeting accession requirements.

The EU’s ambassador to Ukraine, Katarina Mathernova, has said Kyiv could join the bloc by 2030, although the final timeline will depend on how quickly the Ukrainian authorities complete the required legal and institutional reforms.

Mathernova also said she hoped all 33 negotiating chapters could be opened by the end of the summer.

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