Opinion | Why China’s gains from multipolarity have yet to outpace US dominance
The European Union’s recent decision to impose provisional extra tariffs on Chinese-made electric vehicles – pending an anti-subsidy investigation that the EU Commission is due to conclude in November – is part of a series of protective measures adopted by countries or entities challenging what they say are Beijing’s market distortions.
The list is lengthening. In May, the United States announced new tariffs on US$18 billion worth of Chinese imports, including a 100 per cent duty on the import of Chinese-manufactured electric vehicles. Turkey and Brazil have their own trade barriers to Chinese electric cars. India says its car market is “well-protected” by high tariffs on the import of electric vehicles, and Canada is considering imposing penalties similar to those of the EU.

Chinese trade practices are also in the crosshairs of countries in Southeast Asia. Thailand is mulling anti-dumping actions against a host of Chinese goods, and Indonesia is preparing to do the same for textiles.

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Why the EU, US are concerned about China’s overcapacity

Why the EU, US are concerned about China’s overcapacity

In some cases, Chinese carmakers could be able to absorb the costs of the new trade barriers or bypass imposed duties by manufacturing electric vehicles in third countries, but the stakes are higher.

Regardless of the economic impact of the hikes in tariffs, the increase in anti-Chinese trade protections confirms the anarchic tenor of the international system. It’s not just the US and its Western allies targeting Chinese exports with accusations of oversupply and dumping, but also countries in the so-called Global South, which Beijing sees as an alternative pole to withstand Washington’s containment policies.
Brazil is a founding member of the Brics grouping, which for over a decade until its recent expansion comprised China, Russia, India and South Africa. Turkey is part of the North Atlantic Treaty Organisation, but has increased its geopolitical closeness to China through its participation in the SCO as a dialogue partner, and is reportedly interested in joining Brics. Thailand has taken steps to join Brics too. Both Thailand and Indonesia are the major economies within the Association of Southeast Asian Nations, which is China’s largest export market.
Chinese President Xi Jinping is welcomed by Kazakh President Kassym-Jomart Tokayev at the airport in Astana, Kazakhstan, on July 2. Photo: Press Service of the President of Kazakhstan/Reuters

Every nation wants to maximise its own national interests, and this also applies to a multipolar world. That’s why Chinese partners in the Global South will safeguard China-dominated supply chains if they believe doing so benefits them.

Turkey and Thailand are two cases in point when it comes to the increasingly ambivalent nature of trade relations between China and its non-Western interlocutors.

Even though Turkey levelled an additional 40 per cent duty on vehicles imported from China, Turkish electric vehicle producer TOGG is reportedly interested in a joint production venture with Chinese carmaker Guangzhou Automobile Group. It’s also worth mentioning that Ankara is negotiating with the Chinese regarding the construction of a nuclear power plant.

Concerned about the impact of cheap Chinese imports on Thai businesses, Bangkok is embracing protectionism. However, at the same time, China’s BYD said it will buy a 20 per cent stake in its Thai distributor Rever Automotive, after the Chinese carmaker opened its first factory in Thailand last week.
Employees work on an assembly line inside BYD’s new plant in Nikhom Phatthana, Thailand, on July 4. Photo: Bloomberg

Overall, the international system may be more multipolar than a few years ago, but it remains extremely fluid. Moreoever, through its global transport and infrastructure scheme, China has tried to create a system of trade dependencies, but this has not translated into an automatic political alignment by Belt and Road Initiative participants.

China’s rival, the US, cannot escape such constraints either. Washington is reinforcing its tech cooperation with Japan and South Korea, but its key two allies in East Asia have so far been hesitant to follow the US government in raising duties against Chinese goods or blocking China’s acquisition of high-end technology.
There is however a difference between the two great powers. Beijing’s aversion to formal alliances does not help its efforts to prevent possible forms of decoupling or de-risking from trade partners. Instead, while systems of alliances, like those sponsored by the US, are intended to protect their members from external threats, they also have the political purpose of mitigating potential and actual tensions, and settling disagreement among allied nations.

Emanuele Scimia is an independent journalist and foreign affairs analyst

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