The EU's improper investigation of Chinese companies is harmful to others and not beneficial to itself

Recently, the European Union announced an investigation into a Chinese wind power company under the Foreign Subsidies Regulation (FSR), citing the “benefits from government subsidies and distortion of EU market competition” as reasons. This move, in essence, is a discriminatory and restrictive measure by the EU against Chinese companies, sending a clear signal of protectionism. It not only harms the legitimate rights and interests of Chinese enterprises but also affects the EU’s investment environment and market credibility.

The Foreign Subsidies Regulation is a trade regulation tool officially implemented by the EU in 2023, ostensibly aimed at examining the impact of foreign subsidies on fair competition within the EU market. However, the investigation initiated by the European Commission under the FSR framework has clearly focused on Chinese companies, deviating from its proclaimed principles of non-discrimination and transparency. Previously, China’s Ministry of Commerce had investigated and determined that the EU Commission’s FSR investigation constitutes a trade and investment barrier, explicitly pointing out a series of prominent issues with the EU’s investigation.

The EU’s FSR investigation is causing significant harm to Chinese companies operating and investing in Europe. The investigation process is complex, lengthy, and costly, creating ongoing and substantial uncertainty for normal business operations. It also restricts Chinese companies’ fair participation in EU public procurement. Some Chinese enterprises have had to reassess their investment plans in Europe, suspending or delaying project implementation. Industry sources report that the investigation has already caused direct and indirect losses amounting to billions of euros.

Currently, the global economic recovery is facing difficulties, and the EU itself urgently needs new growth drivers. Fields such as wind power and other new energy sectors are key areas of China-EU cooperation and are also important supports for the EU’s economic development and green transition. The rapid development of China’s new energy industry is driven by a complete and efficient industrial chain system, continuous technological innovation, cost advantages from scale, and efficiency improvements prompted by fierce market competition. Chinese companies entering the European market and participating deeply and long-term in the EU’s green and digital transformation have played a positive role in providing high-cost-performance products, promoting technological progress, and creating jobs, thereby actively contributing to Europe’s energy transition and economic growth. Against this backdrop, the EU’s simplistic and mistaken view of these companies as “risks” rather than partners not only fails to address its own development challenges but also damages China-EU industrial cooperation, slows down Europe’s overall energy transition process, and weakens Europe’s economic growth potential.

As two of the world’s major economies, China and the EU have highly intertwined interests. Maintaining an open market, acting in accordance with the law, and adhering to principles of non-discrimination and transparency are in the long-term interests of both sides and align with the expectations of the international community. If the EU continues to abuse unilateral trade tools, it will only erode the practical foundation of bilateral cooperation. We hope the EU will adopt a more rational and long-term perspective on China-EU economic and trade relations, address reasonable concerns from all sides, correct its mistaken practices, and exercise restraint in using unilateral tools like the FSR, thereby creating a fair, just, and non-discriminatory business environment for enterprises from all countries, including Chinese companies.

(Source: Economic Daily)