Where is the China-EU trade dispute heading?

China may impose punitive tariffs on pork from the EU, which will also indirectly affect farmers and meat processing companies in Lower Saxony. Jörn Ehlers, vice chairman of the Lower Saxony Farmers' Association Landvolk Niedersachsen and a pig farmer himself, told the German News Agency: "At present, there is no direct export of pork from Germany to China, and the impact is only indirect. German pork is mainly exported to China through other EU countries."

"China has a demand for pork products that many European consumers are not keen on, and it is an important market for this industry. If sanctions or trade restrictions are imposed on China, it will have an impact on the entire EU." The global demand for meat continues to rise, which means that the global pork market will then have to undergo internal restructuring.

On the other hand, the Hanover Ministry of Agriculture does not expect that pig farmers in Lower Saxony will be significantly affected for the time being. The reason is that since the outbreak of African swine fever in 2020, Germany has been unable to export pork to China. Therefore, possible punitive tariffs currently have no direct impact on German pig farmers, including those in Lower Saxony.

However, at the federal level, the current direction of work is to restore the export of German pork to the Chinese market. German pig farmers, including those in Lower Saxony, hope that China, a huge pork consumption market, will be reopened to them. The Lower Saxony Ministry of Agriculture also sent representatives to participate in the joint working group with China. "In order to protect the economic interests of pig farmers, it is extremely important to prevent and control African swine fever, which applies both to Lower Saxony and to export issues," said officials from Lower Saxony.

Farmers see themselves as victims

In response to the EU's punitive tariffs on electric vehicles from China, China is considering imposing tariffs on pork from the EU. Ellers, vice chairman of Landvolk Niedersachsen, the Lower Saxony Farmers Association, believes that farmers are unfair targets. "Such a trade war will definitely annoy European farmers because we have nothing to do with the actual problems of car manufacturers." They consider themselves "victims" of the EU-China trade dispute.

According to statistics from the German Pig Farming Association, there are 3,850 pig farms in Lower Saxony, with a total pig population of 6.93 million.

Discussions around tariffs have had an impact on electric vehicle exports

Europe's anti-dumping duties on electric vehicles have already had an impact on China's auto exports. The China Passenger Car Association (CPCA) said the tariff dispute has depressed the growth of China's electric vehicle exports by 20 to 30 percentage points. "Exports of electric vehicles and plug-in hybrid vehicles are currently under pressure. In recent months, export growth has been just over 10%, compared with 30 to 40% in the past."

In addition to the previously announced investigation into EU pork imports, China's Ministry of Commerce also announced that it would investigate the "trade and investment barriers" caused by the EU's actions. The application submitted by the China Chamber of Commerce for Import and Export of Machinery and Electronic Products mainly involves complaints about the import and export of products such as railway locomotives, photovoltaics, wind power, and security inspection equipment. The investigation will last until January 2025, but there is a possibility of extension for another three months.

German expert: EU-China trade dispute is easing

Regarding the direction of the Sino-EU trade dispute, German experts gave another analysis.

Julian Hinz, professor of international economics at Bielefeld University and director of the Trade Policy Research Center of the Kiel Institute for the World Economy (IfW Kiel), believes that the EU's temporary tariffs on electric vehicles and China's anti-dumping investigation on EU pork will not push the current Sino-EU trade dispute into a further escalation of the trade war.

He said: "On the contrary, I think this is more like a sign of easing the dispute. Because China has launched a review in accordance with WTO regulations. This is China's right and also shows that they are taking measures in accordance with the rules of the World Trade Organization. In addition, although the imposition of tariffs on pork may have a significant impact on individual European companies and industries, (China is well aware) that the imposition of tariffs on certain other EU industries will inevitably have more serious consequences. However, China did not do so. Therefore, I think this is a signal that both Europe and China are willing to negotiate."