Brussels (TDI): The European Union’s decision to impose punitive tariffs on Chinese battery electric vehicles (EVs) has been termed a strategic blunder by Bruegel, a Brussels-based economic think tank.
In a report released on Wednesday, Bruegel warned that the tariffs could do more harm than good for the EU.
The European Commission announced its decision last Friday, following a contentious vote.
Despite claiming to have secured the necessary support from member states, the vote saw 12 members abstain, while five voted against the measure.
Several European countries and industries have voiced concern, cautioning that the tariffs could undermine the EU’s own competitiveness in the global market.
Bruegel’s report underscores the risks of such protectionist measures.
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“These tariffs will harm EU citizens more than help them and will ultimately backfire on Europe’s automotive industry,” the think tank said.
It argued that the move could shield European automakers from necessary global competition, stifling innovation and discouraging the development of collaborative value chains with Chinese partners.
The report also highlighted the broader implications of the decision, warning that it represents yet another step towards the fragmentation of global trade.
Such moves, it said, will lead to increased economic costs and uncertainties that could have far-reaching consequences for the EU.
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Moreover, trade disputes have a tendency to spill over into other areas, and tensions between the EU and China could strain broader bilateral relations.
Bruegel stressed that there is still time for the EU to reconsider its position before the damage becomes irreversible.
