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| China launches inquiry into European wine exports as trade war fears grow | China launches inquiry into European wine exports as trade war fears grow |
| (4 months later) | |
| China has escalated a trade dispute with the European Union by announcing an anti-dumping investigation into EU wine exports, in the wake of Brussels' decision to slap tariffs on Chinese solar panels. | China has escalated a trade dispute with the European Union by announcing an anti-dumping investigation into EU wine exports, in the wake of Brussels' decision to slap tariffs on Chinese solar panels. |
| The world's second largest economy has driven a wedge between Europe's big two over the move, which could hurt France severely while sparing its biggest trading partner, Germany. | The world's second largest economy has driven a wedge between Europe's big two over the move, which could hurt France severely while sparing its biggest trading partner, Germany. |
| The Chinese prime minister, Li Keqiang, phoned the head of the European Commission, Jose Manuel Barroso, to complain about the EU move on solar panels, which Brussels argues are being dumped at unfair prices. He warned of retaliatory action and declared that there would be "no winners" in a trade war, according to the official China news agency. A spokesman at the commission could not confirm whether the conversation took place. | The Chinese prime minister, Li Keqiang, phoned the head of the European Commission, Jose Manuel Barroso, to complain about the EU move on solar panels, which Brussels argues are being dumped at unfair prices. He warned of retaliatory action and declared that there would be "no winners" in a trade war, according to the official China news agency. A spokesman at the commission could not confirm whether the conversation took place. |
| China's commerce ministry announced the wine probe within less than 24 hours of Karel De Gucht, the EU trade commissioner, slapping tariffs of 11.8% on Chinese solar panels which are supposed to rise to 47.6% within two months if there is no settlement. | China's commerce ministry announced the wine probe within less than 24 hours of Karel De Gucht, the EU trade commissioner, slapping tariffs of 11.8% on Chinese solar panels which are supposed to rise to 47.6% within two months if there is no settlement. |
| The Chinese said they were launching the inquiry on anti-dumping grounds and because of suspicion of unfair subsidies to winemakers. France exported 71% of the €763m (£648.6m) of wine sold to China last year, according to the commission. China took 8.6% of EU wine exports. "The way this was presented seems to us inappropriate and reprehensible, namely the fact that the case is not treated on its own merit but because a decision was taken in another area," a French official told Reuters. Another victim of potentially soaring wine prices in China, Italy, is a big supporter of the solar panels sanctions. | The Chinese said they were launching the inquiry on anti-dumping grounds and because of suspicion of unfair subsidies to winemakers. France exported 71% of the €763m (£648.6m) of wine sold to China last year, according to the commission. China took 8.6% of EU wine exports. "The way this was presented seems to us inappropriate and reprehensible, namely the fact that the case is not treated on its own merit but because a decision was taken in another area," a French official told Reuters. Another victim of potentially soaring wine prices in China, Italy, is a big supporter of the solar panels sanctions. |
| The tit-for-tat action threatened to plunge Europe and China into a trade war, amid divisions between Europe's big powers over the row, with Germany effectively taking Beijing's side against its EU partners while France, the biggest backer of the solar tariffs, is incensed at the Chinese retaliation. | The tit-for-tat action threatened to plunge Europe and China into a trade war, amid divisions between Europe's big powers over the row, with Germany effectively taking Beijing's side against its EU partners while France, the biggest backer of the solar tariffs, is incensed at the Chinese retaliation. |
| France said the decision to penalise Chinese exports was "balanced and responsible", but the German economics minister, Philip Roesler, described the EC's move as "a serious mistake" and demanded that the commission act quickly to settle the dispute. De Gucht had said that the "ball is in China's court" and that it had 60 days to defuse the row and avoid the much bigger tariff. | France said the decision to penalise Chinese exports was "balanced and responsible", but the German economics minister, Philip Roesler, described the EC's move as "a serious mistake" and demanded that the commission act quickly to settle the dispute. De Gucht had said that the "ball is in China's court" and that it had 60 days to defuse the row and avoid the much bigger tariff. |
| De Gucht's decision to phase in the tariff, starting with a quarter of the full penalty, was seen as a concession to Germany. China and Germany are the two global export champions and enjoy an increasingly thriving trade relationship, making up the lion's share of a China-EU trade relationship worth overall nearly €550bn a year, making China the EU's second biggest trading partner. It is highly unusual for the EC to launch such a major trade dispute against the wishes of Europe's biggest trader and exporter. Chancellor Angela Merkel last week advised against imposing tariffs and called for more negotiations. Several other countries, including Britain, also opposed the EC move. | De Gucht's decision to phase in the tariff, starting with a quarter of the full penalty, was seen as a concession to Germany. China and Germany are the two global export champions and enjoy an increasingly thriving trade relationship, making up the lion's share of a China-EU trade relationship worth overall nearly €550bn a year, making China the EU's second biggest trading partner. It is highly unusual for the EC to launch such a major trade dispute against the wishes of Europe's biggest trader and exporter. Chancellor Angela Merkel last week advised against imposing tariffs and called for more negotiations. Several other countries, including Britain, also opposed the EC move. |
| The EC said Beijing was entitled to launch its investigation under World Trade Organisation rules, but denied that there were any grounds for the procedure. The EU has bought €21bn of Chinese solar panels in recent years and China dominates 80% of the European solar panel market. | The EC said Beijing was entitled to launch its investigation under World Trade Organisation rules, but denied that there were any grounds for the procedure. The EU has bought €21bn of Chinese solar panels in recent years and China dominates 80% of the European solar panel market. |
| China is by far the world's leading producer of the panels, an ascendancy that European business lobbies argue is due to heavy state support in the form of subsidies and cheap loans. The sparring of the past 48 hours sets the scene for tense negotiations between Brussels and Beijing over the next two months as well as battles behind the scenes across Europe. | China is by far the world's leading producer of the panels, an ascendancy that European business lobbies argue is due to heavy state support in the form of subsidies and cheap loans. The sparring of the past 48 hours sets the scene for tense negotiations between Brussels and Beijing over the next two months as well as battles behind the scenes across Europe. |
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