China has sufficient tools to deal with EU’s incessant anti-subsidy probes: social media influencer

Workers complete assembling an electric vehicle (EV) at China's EV start-up Leapmotor in Jinhua, East China's Zhejiang Province on April 1, 2024. The smart EV factory delivered 14,567 new vehicles in March, a yearly increase of 136 percent. Photo: VCG

Workers complete assembling an electric vehicle (EV) at China’s EV start-up Leapmotor in Jinhua, East China’s Zhejiang Province on April 1, 2024. The smart EV factory delivered 14,567 new vehicles in March, a yearly increase of 136 percent. Photo: VCG

Facing incessant anti-subsidy probes against Chinese companies, China actually has sufficient countermeasures, and, if Europe stubbornly continues to take action, China may have to take a series of measures to hit back, Yuyuan Tantian, a social media influencer affiliated with state broadcaster CCTV said in a penned article on Saturday.

The remarks came after two Chinese companies were forced to withdraw from a public procurement bid in a Romanian photovoltaic park project due to the EU’s anti-subsidy investigations. The complexity of the evidence collection required, and the insufficient time provided by the EU led to their withdrawal.

This has been the third investigation under EU’s Foreign Subsidies Regulation (FSR) since its launch last July, all targeting Chinese companies. It comes as certain politicians within the bloc raised so-called concerns regarding “overcapacity” in Chinese emerging industry including electric vehicles (EV).

The EU’s actions and hypes do not align with the interests of EU members, Yuyuan Tantian wrote. 

Some European countries, such as Germany, have expressed opposition to high tariffs on Chinese EVs, stating that EVs from China would drive the innovation of German automobile industry.

Moreover, the EU itself has been providing substantial subsidies in various sectors, including new-energy industries and the agricultural sector.

In response to EU politicians’ efforts to suppress Chinese companies, China has prepared sufficient countermeasures, Yuyuan Tantian wrote in the article.

Shen Qian, a lawyer familiar with trade and commerce issues, told Tanyuan Tantian said that the EU is highly dependent on the Chinese market for exports including wine and dairy, and the EU offered huge subsidy to its agriculture industry. 

Shen said that the EU’s subsidy as well as dumping practices has caused substantial harm to related industries in China, so it is necessary for China to demonstrate its determination to protect the interests of Chinese companies too.

Last September, the Chinese Ministry of Commerce announced an anti-subsidy ruling on imported potato starch from the EU and decided to keep in place the anti-subsidy tariffs. 

In addition to agricultural products, the EU also relies on the Chinese market in many other sectors such as aviation. Airbus recently released a report predicting that China is expected to surpass the US and Europe to become the world’s largest aviation market.

“Some EU politicians’ attempts to suppress China are undoubtedly shooting themselves in the foot,” Yuyuan Tantian wrote.

The world is young domestic firms’ oyster

A view of the booth of Huawei at the 2024 Mobile World Congress Barcelona in Spain earlier this year. GAO JING/XINHUA

In 2014, a group of experts in smart manufacturing, each of them boasting around 15 years of work experience, gathered in a three-bedroom apartment in Beijing and decided to start up with Beijing Roborock Technology Co Ltd. What was extraordinary was their clear and simple ambition: to develop the world’s best robotic vacuum cleaner.

Ten years on, their dream has come true. Roborock is a leading player in its sector and, in terms of global sales in 2023, the top-selling brand among smart vacuum cleaners worldwide, according to Euromonitor International, a market research firm.

Its products are available in more than 170 countries and regions, with nearly half of its revenue coming from overseas markets.

Quan Gang, president of Roborock, summed up the success story.”From day one, our eyes were set on the global market. From the very beginning, we have sought to meet the demands of global users. Our product design, production and marketing efforts have been tailored to meet their demands from the outset.”

That helped the startup to remain flexible and nimble while preserving its unique technology. Corporate executives and experts said Roborock is the epitome of new-age Chinese enterprises that see the world as their oyster right from day one.

Such companies are quick to recognize that growing globally competitive brands in their respective segments is critical to success these days. They rely on both China’s manufacturing prowess and their own strengths in research and development.

What distinguishes them from the previous generation of globally known Chinese enterprises is their global vision and clarity on goals. While the previous lot went global only when they had grown big enough in the domestic market, the new bunch target the global market from the very beginning, experts said.

Huang Chenhong, president of German software and cloud giant SAP Greater China, who has witnessed the transformation of Chinese companies in their global expansion over the past three decades, said, “Despite challenges such as lackluster global demand and geopolitical uncertainties, Chinese companies have not slowed down their pace of going global.”

Data from China’s Ministry of Commerce prove his point. Chinese enterprises’ outbound direct investment grew 5.7 percent year-on-year last year to exceed 1.04 trillion yuan ($143.7 billion), highlighting their continued expansion overseas.

“I think globalization is now entering a new stage. Globalization today involves more Chinese companies expanding their business overseas,” Huang said. “We can see many enterprises, whether State-owned, private or even small and medium-sized enterprises, have 30 to 50 percent of their business overseas. Some companies are even born to serve overseas markets and have never considered doing business domestically.”

Chinese companies have attained a stage of technological innovation where they are starting to embody the spirit of multinational corporations.

“In the past, when we talked about MNCs, we thought of German or American companies. Today, Chinese companies come to mind naturally,” Huang said, adding that SAP has helped many Chinese companies such as Lenovo, BYD and Mindray navigate the international waters over the past three decades.

GT Voice: Protectionism can’t solve EU’s weak competitiveness in solar

Illustration: Liu Xiangya/Global Times

Illustration: Liu Xiangya/Global Times

European governments appear to be ready to move to support their solar power manufacturers this week, but Europe’s solar industry is in trouble – not just due to a lack of policy support but also because of flawed competitiveness.

Swiss solar panel maker Meyer Burger is packing up a German factory to send production to the US, joining a growing list of European renewable-energy factories shutting down or relocating, Reuters reported on Monday.

In contrast to Europe, the US government does provide attractive subsidies and policy support for green sectors. Yet, if Meyer Burger wants to succeed in the competitive US market, it still needs to rely on its own strength, not just policy support.

The solar panel maker’s choice is just one example of the serious challenges facing the European solar industry, which is at a relative disadvantage in the global photovoltaic (PV) market. China has taken a dominant position, with its companies accounting for 80 percent of the world’s solar manufacturing capacity and with low costs. 

Meanwhile, US subsidies announced as part of the 2022 Inflation Reduction Act allow some renewable-energy manufacturers and project developers to claim tax credits, intensifying the competitive pressure on European companies.

Nevertheless, the woes facing Europe’s solar industry are not solely due to a lack of policy support, as there is obvious weakness in the competitiveness of European industry. Despite having a well-established solar supply chain, European companies face challenges in terms of technological innovation, investment in research and development, optimized production procedures and cost reducing.

On the one hand, they have not achieved economies of scale in manufacturing. On the other hand, while Chinese companies are actively exploring next-generation PV technologies, the progress by their European peers is relatively slow.

It is exactly under such circumstances that some in the EU have been quick to point a finger at China for the EU’s diminishing competitiveness, resulting in a worrying rise in the risk of trade friction. For instance, in early April, the EU launched two probes into Chinese solar panel makers suspected of using government subsidies, according to media reports.

However, the EU cannot simply attribute its competitive setbacks to China’s “unfair competition.” The global demand for renewable energy necessitates fair competition to drive technological advancements and industrial efficiency. China’s success in the PV industry results largely from its own competitive edges through its consistent investment in technology, scale, cost controls and innovation. 

If Europe aims to enhance the competitiveness of its solar industry, it must address its own technological and cost challenges rather than relying solely on trade protection measures.

The significant expansion of China’s solar panel capacity is a welcome development for European companies and consumers seeking to develop their own PV systems. The transition to green energy is costly, and inflation is already high enough. China’s help in lowering such costs is undeniably conducive to the EU’s ambitious energy transition plan.

The EU’s anxiety about protecting its own industry is understandable, but the root cause lies in the long-term decline in the bloc’s competitiveness, not in its competitors. The financial crisis, euro crisis, Russia-Ukraine conflict and bureaucratic reactions may have all played a part. 

Furthermore, misleading policy trends, such as hype about “de-risking” from China, have also hindered the progress and development of the EU’s PV industry.

The EU’s ability to sustain and improve its competitiveness hinges on whether it takes the proper measures to effectively address these enduring challenges. Embracing a more open-minded and globalized approach, rather than being overly ideological and protectionist, may offer a viable solution.

‘Choosing China means choosing opportunities, and investing in China means investing in the future’: MOFCOM

Tim Cook, chief executive officer of Apple Inc, exchanges business cards with participants at the China Development Forum 2024 in Beijing, on March 24, 2024. About 400 people, including experts, entrepreneurs, government officials and representatives of international organizations, attended the opening ceremony of the forum. Photo: VCG

Tim Cook, chief executive officer of Apple Inc, exchanges business cards with participants at the China Development Forum 2024 in Beijing, on March 24, 2024. About 400 people, including experts, entrepreneurs, government officials and representatives of international organizations, attended the opening ceremony of the forum. Photo: VCG

 

“Choosing China means choosing opportunities,” He Yadong, spokesperson of Ministry of Commerce (MOFOCM) said on Thursday, when asked about the recent surge of visits by global CEOs to the country.

The spokesperson said China welcomes multinational companies to actively participate in Chinese market for further development.

The remarks came amid the background as China hosts a series of high-level events this week, attracting a good number of global CEOs. Senior officials of MOFOM also met with top executives from over 20 multinational companies such as Apple, Qualcomm and Mercedes-Benz. These multinational companies are of medicine, automobiles, food, finance, cosmetics, electronic information, chemical industry and energy. 

Multinationals from all walks of life visit China intensively to feel the “spring vigor” of China’s economic recovery, which demonstrates the “strong magnetic attraction” of the Chinese market, the spokesperson said. 

China welcomes multinational companies to actively participate in the construction of a modern industrial system in China for greater inclusive development, He said. 

Executives of multinational companies have expressed their optimism of the Chinese market and vowed to continue to invest in China, He said, citing the example of Apple which will continue to increase its investment in R&D and augment its supply chain in China, and the German chemical company Wacker will continue to invest in China and support the green and low-carbon transformation of traditional industries.

Jean-Pascal Tricoire, the Chairman of Schneider Electric, said in a forum held on Monday that the company will fully leverage their digital advantages and sustainable experience and deepen the integration of digital and real industries, accelerate the dual transformation of digitalization and decarbonization, and work with Chinese partners to foster new quality productive forces.

The company said the supply chain in China has increased its overall efficiency by 8-10 percent year by year, and its overall energy consumption decreased by 13 percent compared to 2019 with the deployment of advanced digital systems and artificial intelligence technology.

Data from MOFCOM showed that in the first two months of 2024, the number of newly established foreign-invested enterprises increased by 34.9 percent to 7,160 in China.

China continues to connect the world with a higher level of opening-up. “Choosing China means choosing opportunities, and investing in China means investing in the future,” He noted.

Global Times