Germany to abstain from EU vote on China EV tariffs

Germany is set to abstain from an upcoming European Union vote on imposing provisional tariffs on electric vehicles (EVs) imported from China, sources told Reuters on Friday. This decision marks the first significant test of support for Brussels’ landmark trade case against China.

The proposed tariffs, which could be as high as 37.6%, do not require immediate approval from member states. However, the final decision could be blocked if a qualified majority of the EU’s 27 members oppose it.

“Germany will abstain in the spirit of ‘critical solidarity’ with the EU Commission,” said one source. This abstention effectively supports the Commission as it continues its negotiations with Beijing over this substantial trade dispute. The sources chose to remain anonymous as the decision is confidential.

Germany’s stance comes amid ongoing anti-subsidy investigations and negotiations between the EU Commission and the Chinese government. German carmakers, who sold a third of their vehicles in China last year, are particularly concerned. They fear that the tariffs could provoke retaliatory measures and spark a trade conflict with their second most important trading partner.

Chancellor Olaf Scholz commented on the matter, saying, “Germany expects the EU executive will succeed in reaching an agreement with China on EVs, and that an agreement would be beneficial for Europe’s car industry.”

While Germany takes a cautious approach, other EU members are divided. France is among the firmest supporters of the case, while Hungary has expressed opposition. The vote represents the first official test of support for the Commission’s tariff proposal, a move initiated without any industry complaint – a first in EU trade cases.

As the EU navigates this complex trade issue, the outcome of Monday’s vote will be closely watched, potentially shaping the future of EU-China trade relations.

Read more on Why Beijing urged European Union to drop EV tariffs