—— Interview with Li Hengqing, Director of the Institute of Information and Strategy in Maryland, USA
[Epoch Times November 13, 2021](Epoch Times reporters Li Bei and Liang Xin reported in Hong Kong) “Once the EU and other 32 countries cancel the unilateral GSP tariff preferences for China, the goods China exports to these countries will be Tariffs ranging from 3% to 20% will soon be added, which will immediately significantly reduce the competitiveness of Chinese products.” Li Hengqing, director of the Institute of Information and Strategy in Maryland, USA, said in an interview with The Epoch Times.
The 27 member states of the European Union and a total of 32 countries including the United Kingdom, Canada, Turkey, Ukraine, and Liechtenstein have decided to abolish the Generalized System of Preferences granted to China from December 1 this year. The General Administration of Customs of the Communist Party of China confirmed this news on the 25th of last month.
After more than ten days of silence, the Chinese Communist Party media People.com.cn quoted Wei Jianguo, the former Vice Minister of Commerce, in response on the 5th of this month, stating that China has “graduated with outstanding results” after 20 years of joining the WTO.
The Generalized System of Preferences is a tariff preference given by developed countries to manufactured and semi-manufactured products exported by developing countries. China joined the World Trade Organization as a developing country on December 11, 2001. Therefore, in the past 20 years, while enjoying the most-favored-nation status among WTO members, China has also received universal access from 40 Western developed countries. Preferential tariff preferences.
If you add Switzerland, Japan, Russia, Belarus, and Kazakhstan, which previously abolished China’s GSP, and the United States, which has substantially increased tariffs on Chinese imports from 2019, only Norway, Australia and New Zealand are left, and China has not been cancelled. Generalized System of Preferences.
Li Hengqing believes that these statements of the CCP are “self-deception”. He said that the removal of GSP tariffs by 32 countries against China will bring economic and political double blows, and it will be huge. Because the tax rate of 3% to 20% is very large, this will set a very large barrier for China to re-enter this market or occupy this market in the next step.
The Generalized System of Preferences is different from bilateral most-favoured-nation treatment. It is completely unilateral. The most-favored-nation treatment is bilateral, and both parties have both interests and obligations and cannot be unilaterally cancelled. Therefore, once these 32 countries cancel their preferential policies for China, the CCP has no reason or no way to reverse sanctions against these European countries.
Europe is the largest exporter of Chinese goods
“Follow-up purchase chains among these 32 countries in Europe-for China is the supply chain, must be reorganized. It should be said that it will be a big challenge for China’s trade in the future.” Li Hengqing said.
The European Union overtook the United States last year to become China’s largest trading partner. Last year, the European Union imported US$438.75 billion in goods from China, an increase of 5.6% over the previous year; exports to China were US$231.67 billion, an increase of 2.2%. Last year, the EU’s trade deficit with China was US$207.08 billion.
From January to July this year, the EU imported 1.789.75 billion yuan (US$280.42 billion) from China, a year-on-year increase of 22.2%; exports to China were 11.73.01 billion yuan (US$183.79 billion), a year-on-year increase of 25.3%.
Li Hengqing said: “Once the tariffs of 3%-20% are added, it will invisibly increase the cost of China’s exports to these 32 countries by 3%-20%, which will immediately reduce the competition of Chinese products. Power, the price advantage is gone.” “This puts a lot of pressure on the CCP.”
Europe has always swallowed its anger towards the CCP in the past
This time the 32 countries have cancelled the GSP preferences for China, which coincides with the 20th anniversary of China’s accession to the WTO. Moreover, the Sixth Plenary Session of the 19th Central Committee of the Communist Party of China, which is related to whether Xi Jinping can be re-elected, only closed on the 11th, and the situation is very grim. In order to stabilize the situation, the CCP is propagating the achievements of WTO accession internally, and the former Deputy Minister of Commerce said that China has “graduated”. This is deceptive propaganda internally.
And Xi Jinping said at the Import Expo held on November 4 that China has fully fulfilled its WTO commitments in the past 20 years and cited the reduction of China’s import tariffs from 15.3% to 7.4% as an example.
The dissatisfaction of Western countries such as the United States and Europe with the CCP is precisely because the CCP has not abided by its commitments when it joined the WTO in the past 20 years. The European Union is very disgusted with the restrictions on its companies’ investment in China and the forced sharing of its confidential technology.
Li Hengqing said that in the process of dealing with China in the past few decades, Europe has actually been swallowing its anger, because the huge market of China is too attractive to them, and businessmen are all profiting. The CCP has adopted various strategies to defeat these countries, and may use economic and trade sanctions at any time to strike economically against countries that dare to stand up.
Contest between Europe, America and the CCP
Li Hengqing said that the CCP’s image in the international market and the international community is very poor, and it has “become a villain in the international community”. The international community has also become more and more aware of what the CCP is doing.
Li Hengqing believes that the CCP has not only developed economically, it has also become “a great danger maker in a region.” It confronts the world politically and diplomatically, and wants to change the universal values that everyone originally adhered to.
Li Hengqing said, “Europe has always been talking about human rights issues in the past, but it has always held it up high and put it down gently. There is no substantive action.” But this time it should be said that it has substantial significance. The 32 countries have all cancelled the GSP against China. “This is a very substantial sanction on China’s economy.” However, he said that this measure is actually the EU’s sanctions on the CCP. Take countermeasures.
In March of this year, the United States, the European Union, the United Kingdom, Canada, Australia, and New Zealand and other Western countries issued statements condemning the CCP’s violation of human rights in Xinjiang. The U.S. and the European Union imposed sanctions on relevant officials and institutions of the CCP; the CCP immediately countered them. , To offer anti-sanction measures against EU members, scholars, etc.
The EU immediately suspended the approval process for the China-EU Comprehensive Investment Agreement with China. In response to the EU’s response, Chinese officials claimed that the confrontation with the EU must be “accompanied to the end.”
Two months later, the European Parliament voted to formally freeze the approval process of the China-EU Comprehensive Investment Agreement. This agreement, which has been negotiated for 7 years and 35 rounds of negotiations, was originally intended to replace the 25 bilateral investment agreements between EU member states and China, reducing the uncertainty and unfair treatment of European investors’ investment in China.
On October 31, the EU and the United States also reached an agreement on the abolition of tariffs on steel and aluminum products, which resolved the previous trade dispute between the two parties. Some Chinese media have interpreted this, saying that while the United States has cancelled tariffs on the European Union, it is also increasing tariffs on related products in China. This will make China’s steel products less advantageous than before. They believe that the US and Europe’s move is to join forces in China. For kicking out of the European and American markets. @
Editor in charge: Shao Yi
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