Atlantic Council this week released a new commentary arguing that Faced with growing Chinese manufacturing overcapacity and an inadequate trade defense toolkit, the EU is moving toward developing a more assertive, Section 301-style tariff instrument to address state subsidies and structural industrial imbalances.
The commentary states that Transatlantic coordination on China tariffs should be pursued narrowly on the basis of shared self-interest, beginning bilaterally between Washington and Brussels before expanding to other like-minded partners.
Atlantic Council stated:
Faced with these constraints, national capitals are increasingly concluding that the EU needs a more direct way to address the drivers of Chinese overcapacity—state subsidies and less-than-humane working conditions—and a tariff mandate that can actually be used in practice, unlike the current Anti-Coercion Instrument (ACI). To be compatible with EU law, such a mechanism—the EU's version of Section 301—would need to be strictly proportional, subject to regular judicial and political review, and allow only for temporary tariffs.
Read the full commentary: As China's surpluses become unbearable, the EU is edging toward its own Section 301