CHINA - Overproducing Green Tech?
“Chinese subsidies are pervasive,” Rolf Langhammer, former vice president of the Kiel Institute for the World Economy (IfW-Kiel), told DW. “They encompass almost all industries and are far larger than any EU or US subsidies.”
The IfW-Kiel report revealed how Chinese subsidies for domestic green-tech firms had increased significantly in 2022. The world’s largest EV maker, BYD, received €2.1 billion, compared with €220 million just two years earlier. Support for wind turbine maker Mingyang rose from €20 million to €52 million.
“US and European nervousness is coming at a time when electric vehicle demand [in the West] has faltered a bit,” Brad W. Setser, a senior fellow at the Council on Foreign Relations, told DW. “It now looks like China is going to be an even bigger exporter of electric vehicles going forward.”
In October, the European Union began a probe into whether it should impose higher tariffs on Chinese-made EVs to “offset state subsidies and to level the playing field.” Brussels currently levies a 10% tariff on Chinese-made vehicles and, according to media reports, a retroactive 25% tariff could be introduced as early as July. Industry analysts say the move would make medium-sized Chinese sedans and SUVs more expensive than their European equivalents.
Despite concerns over tariffs and future access to Western markets, Chinese producers have vowed to increase output. The world’s biggest battery maker, CATL, said it would press ahead with its aggressive expansion plans. BYD told investors recently that it targeted a 20% sales increase this year.
“They [European car producers] say they can compete with China. German automakers have a quarter of their foreign direct investment in China and also benefit from Chinese subsidies and they fear retaliation,” Langhammer said, referring to possible tit-for-tat measures Beijing may levy in the event of higher EU tariffs.
Washington is concerned that Chinese firms will use loopholes in US trade deals with Mexico and Canada to circumvent higher import tariffs by producing Chinese-branded EVs in the two neighboring countries. New legislation has been tabled to counter that.
Analysts argue, however, that China can’t succeed without strong and stable markets for its products, which should give US and EU leaders the edge in negotiations with Beijing.
-www.dw.com, 10 April 2024
Arno's Commentary
China is the main factory making the world rich, and of course themselves. Subsequently, many ask, why is China so successful? The answer is rather simple: willingness to constantly change. There is no such thing as “good old China”; rather, they analyze global conditions and change accordingly. In plain words, from communism to common social capitalism.
In this case, the targeted issue is subsidies. Apparently, the Chinese Communist Party knows what’s best for the state.
Here we recall the decade-long legal battle between Boeing and Airbus, accusing each other of unfair competition due to government subsidies. In the end, there was no winner or loser.
Why not? The world has already progressed into the so-called “new world order.” Each country becomes more dependent on the other. The analysis states: “China can’t succeed without strong and stable markets for its products, which should give US and EU leaders an edge in negotiations with Beijing.” WorldPopulationReveiw.com lists the five top manufacturing nations: China 31.6%, USA 15.9%, Japan 6.5%, Germany 4.7%, and India 2.9%.
What is the Christian worldview in relation to this development? World unity! We will continue to insist that, based on the prophetic Word, one day all of it will collapse in the Battle of Armageddon—absolute, total, and unconditional global destruction.
The prophet Daniel categorizes four different Gentile superpowers. But the end is recorded in Daniel 2:45: “Forasmuch as thou sawest that the stone was cut out of the mountain without hands, and that it brake in pieces the iron, the brass, the clay, the silver, and the gold; the great God hath made known to the king what shall come to pass hereafter: and the dream is certain, and the interpretation thereof sure.”
Arno Froese is the executive director of Midnight Call Ministries and editor-in-chief of the acclaimed prophetic magazines Midnight Call and News From Israel. He has authored a number of well-received books, and has sponsored many prophecy conferences in the U.S., Canada, and Israel. His extensive travels have contributed to his keen insight into Bible prophecy, as he sees it from an international perspective.
