PEKING (dpa-AFX) - China and the EU have reached an initial rapprochement in the dispute over tariffs on e-cars. Both sides want to negotiate with each other, as was announced on Saturday. The Brussels authorities had previously published plans to impose tariffs on Chinese e-cars if no other solution could be found with China. The EU accuses Beijing of unfairly subsidizing battery-powered models.

It initially remained unclear when and within what framework negotiations would take place. German trade associations welcomed the willingness of both sides to negotiate. Meanwhile, the EU reiterated its demands.

EU speaks of constructive talks

Chinese Trade Minister Wang Wentao and EU Trade Commissioner Valdis Dombrovskis exchanged views in a video link on Saturday. The Chinese Ministry of Commerce subsequently announced that both sides had agreed to enter into consultations on the EU's anti-subsidy investigation into Chinese e-vehicles.

A spokesperson for the EU Commission described the talks between the two parties as "open and constructive". However, the EU emphasized that a negotiation result must be effective against harmful subsidies in any case. Talks would continue at all levels in the coming weeks.

German industry warns against giving in too soon

"The fact that China, like the EU, is now open to negotiations is an important first step on the way to a solution," said Hildegard Müller, President of the German Association of the Automotive Industry (VDA). The goal must be fair competition for all. "Both sides are now called upon to conduct the negotiations openly and constructively."

Wolfgang Niedermark, Member of the Executive Board of the Federation of German Industries (BDI), also welcomed the planned negotiations. Nobody had an interest in uncontrolled escalation. However, the EU would be well advised to stay on its path and "show some teeth", said Niedermark, who is accompanying Robert Habeck on his trip to China. There is overcapacity and market disruption not only in the automotive sector, but also in other industries. "And these must be addressed."

The EU Commission published its plans for punitive tariffs in mid-June. The duties of up to 38.1 percent would be withheld retroactively from the beginning of July in certain cases if no other agreement is reached with China. However, a decision on the final determination does not have to be made until the beginning of November.

Habeck praises "first step"

"This is a first step and many more will be necessary," said Habeck in Shanghai on Saturday. During the day, he had held talks in Beijing with Chinese politicians on the impending tariffs, including Trade Minister Wang.

Habeck said that he had the impression that his messages had been getting through more and more throughout the day. In response to a question about his possible role, he said that he had done what one had to do as German Economics Minister in the situation. "And whether it was a contribution and how much of a contribution it could have been is for others to judge."

Habeck sees opportunity for compromise

Habeck had previously emphasized that these were not blanket punitive tariffs, but tariffs to compensate for unfair competitive advantages. He did not criticize the fact that China produces significantly more goods than it consumes. "Overcapacity is not the problem, nor is it the accusation" - and neither are subsidies. The problem arises when state subsidies are used to increase export opportunities.

On possible compromises in the upcoming negotiations, Habeck then said in the evening: "I can see some, including in the field of electric mobility." However, China must now make proposals and the EU Commission must lead the negotiations.

Chinese e-cars 20 percent cheaper according to the EU Commission

Since last fall, the EU Commission has been investigating whether e-cars in China benefit from subsidies that distort competition. According to the Commission, Chinese electric cars are normally around 20 percent cheaper than models manufactured in the EU.

The Commission finally came to the preliminary conclusion that the value chain for battery electric vehicles (BEV) in China benefits from unfair subsidies. The Commission therefore threatened to impose additional duties. So far, duties of ten percent have been levied.

Brussels' move follows similar measures by the USA. In mid-April, the US government imposed special tariffs on electric cars, semiconductors, solar cells, cranes and other products from China./jpt/DP/he