The European Union has significantly reduced its proposed tariff on Tesla electric vehicles imported from China, slashing the extra duty by more than half after further scrutiny requested by the automaker. The European Commission, responsible for the bloc's trade policy, revealed this adjustment on Tuesday, marking a critical development in the ongoing investigation into alleged Chinese subsidies.

Initially, the EU had proposed an additional tariff of 20.8% on Tesla's Chinese-made EVs. However, following the company's appeal for a reassessment, this figure has been reduced to 9%. The Commission also indicated that some Chinese companies, particularly those in joint ventures with European automakers, might also benefit from lower tariffs on their EV imports.

This reduction comes amid the EU's broader effort to counter what it considers unfair subsidies that have bolstered Chinese EV production. Despite the recalibration for Tesla, the Commission maintains that Chinese EV manufacturers continue to benefit from extensive state support. Consequently, the EU has proposed tariffs as high as 36.3% on other Chinese companies that did not cooperate with the investigation—a slight decrease from the initial maximum rate of 37.6%.

The standard 10% EU duty on car imports remains, with these additional tariffs intended to level the playing field for European manufacturers. However, Beijing has reacted strongly to the draft findings, with China's Ministry of Commerce expressing firm opposition and concern. The ministry criticized the EU's conclusions, arguing that they were based on unilateral determinations rather than mutually agreed facts.

China has called for the EU to pursue a rational and pragmatic approach to resolving the issue, urging the bloc to take concrete steps to prevent further escalation of trade tensions.

It is almost palpable how the EU Europeans are desperately trying to adjust their China policy in line with the geopolitical situation. Gradually, the realization is seeping in that China should not be messed with, as China is likely to be the gateway to the BRICS states and their currency area and credit system. The accelerated integration of the euro as an international settlement layer has certainly accelerated this realization. The stabilization of this currency is unlikely to be possible without the BRICS. In the long term, the euro is a candidate for death anyway.