China to probe European dairy imports as trade dispute escalates

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London/Hong Kong CNN —

Beijing is investigating whether dairy producers in the European Union receive unfair government subsidies, marking the latest salvo in an escalating trade dispute.

China’s Ministry of Commerce said Wednesday that local dairy producers had requested the probe, citing 20 different subsidy programs that may benefit the EU dairy industry. These ranged from financial support for farming equipment and supplementary income for young farmers to environmental and administrative subsidies.

An initial review of the evidence had found sufficient grounds for an anti-subsidy investigation, the commerce ministry added in a statement. It noted that the investigation could take up to 18 months.

The EUis among the world’s largest dairy exporters and China is the second-biggest destination for its skim-milk and whole-milk powders, according to European Commission data. The United Kingdom and United States are the top two recipients of the EU’s butter and cheese exports, with China coming in third and eighth place respectively.

The announcement comes a day after the EU confirmed that it would move ahead with additional tariffs on most electric vehicles imported from China.

Aerial view of Tesla electric vehicles to be shipped aboard sitting parked at Nangang Port on March 30, 2023 in Shanghai, China.

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