EU unveils new China countermeasures toolkit

The European Union has agreed on a new defense mechanismallowing retaliation against countries that use economic blackmail or trade punitive measures, such as China’s blockade of Lithuanian imports due to the Baltic state’s ties with Taiwan.

Member States can ask the European Commission to investigate any case of coercion and, if a country is found guilty, the Commission can develop a list of countermeasures. These could include raising tariffs, removing import or export licenses, and restricting services and public procurement. Unless a majority of the 27 member states oppose it, the countermeasures will be implemented in about six months after the law is passed.

“We made great strides overnight to make this new tool an effective deterrent and a powerful anti-coercion tool,” said Bernd Lange, Chair of the Committee on International Trade, called after the talks. “With a broad list of countermeasures, a framework for redress for injuries, clear timelines and Parliament’s close involvement throughout the process, we are close to finalizing an agreement that will enable the European Union to stand up against economic blackmail To defend.”

The anti-coercive instrument is the latest unilateral measure taken by Brussels since then Labeling China as a systemic rival in 2019. Trade Commissioner Valdis Dombrovskis stressed their importance in deterring economic bullying and safeguarding EU interests in a volatile world. The final approval of the political agreement is still pending in the coming weeks.

Growing disillusionment with the World Trade Organization litigation, partly due to US reluctance to get fully involved, has prompted the EU to seek alternative solutions. The anti-coercion instrument aims to discourage nations from attacking the EU and its member states with economic coercion in the form of trade or investment measures.

end of 2021, China has instituted an informal embargo on all imports from Lithuania and EU imports containing Lithuanian components after Vilnius allowed Taiwan to set up a representative office. The EU has lodged a complaint with the WTO and the case is ongoing.

Also Read: Lithuania’s Goods Banned from Entering Chinese Ports

Also the Commission reported several cases of economic coercion against EU members every year. In response, the EU introduced a mechanism to punish companies receiving foreign subsidies that distort the internal market and another measure to encourage openness in other countries’ public procurement markets. The EU has also proposed a ban on products made through forced labour.

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