China Investigates EU Dairy Exports Amid Trade Tensions

In a significant escalation of trade tensions, China has initiated an anti-subsidy investigation into dairy products imported from the European Union. Announced by the Chinese Ministry of Commerce on August 21, the probe targets a variety of dairy items, including cheese, milk, and cream, following a request from China's dairy industry. This investigation comes just a day after the European Commission proposed new duties on Chinese electric vehicles, highlighting the ongoing tit-for-tat trade disputes between Beijing and Brussels. The investigation will cover nearly all EU dairy shipments from April 2023 to March 2024, with a focus on 20 subsidy programs that may benefit EU dairy producers. In 2023, EU dairy exports to China were valued at €1.76 billion, making China a crucial market for European dairy, particularly for countries like Ireland, Italy, and France. The potential imposition of duties could significantly impact these exports, especially as the EU dairy sector is already facing challenges from retaliatory measures. European officials have expressed concern over the investigation, with the European Commission pledging to defend the interests of the EU dairy industry and ensure compliance with World Trade Organization rules. The EU Chamber of Commerce in China noted that the investigation was expected following the EU's recent trade measures against Chinese electric vehicles, indicating a broader pattern of retaliatory trade actions. As the situation develops, the EU's dairy sector remains on high alert, with industry leaders emphasizing the importance of maintaining access to the Chinese market amidst rising trade barriers.