EU May Introduce 50% Tariff on Chinese Batteries
The European Energy Security Initiative (EIES) has released a report stating that the EU is 7-10 years behind China in battery production. To close this gap, Brussels is considering introducing a 50% tariff on Chinese batteries over the next 5-7 years.
Why Is the EU Protecting Its Market?
According to the report, China dominates the battery and electric vehicle sector, while European companies struggle to compete due to lower prices and strong government support in China.
To counter this, the EU plans to:
- Invest €20 billion ($20.7 billion) in building a new gigafactory with a capacity of 10 GW.
- Form partnerships with Japanese and South Korean battery manufacturers to accelerate technological development.
- Introduce strict import standards for batteries and electric vehicles.
The gradual introduction of a 50% tariff on Chinese batteries is designed to give European companies time to develop domestic production and create fair competition conditions.
Will These Investments Be Enough?
EIES estimates that the EU will need €100 billion to fully develop its battery sector. Of this amount, €20 billion is planned for a state-of-the-art gigafactory in partnership with Japanese and South Korean manufacturers.
The report also recommends adopting a U.S.-style approach, where the Inflation Reduction Act (IRA) has stimulated private investments in clean energy, totaling $250 billion.
What’s Next?
The EU has not yet made a final decision on tariffs, but the trend toward stricter measures against Chinese imports is becoming more evident.
If these tariffs are implemented, they could escalate trade tensions between the EU and China, potentially leading to retaliatory measures from Beijing.
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