China's EV Surge: Debunking Subsidy Myths

China asserts that its electric vehicles are not subsidized in ways prohibited by the World Trade Organization, countering claims by U.S. officials including President Biden. Chinese EVs, popular in the global market, are said to be a result of competitive advantages and market laws, rather than government subsidies.

China never makes use of subsidies for electric vehicles that have been prohibited by the World Trade Organization, a spokesperson for its foreign ministry said on Thursday.

Chinese companies are producing waves of low-priced EVs that some worry could harm big U.S. automakers, some of which have focused recently on big gasoline-powered sports utility vehicles. "China's new energy products, including electric vehicles, are widely popular in the international market," Mao Ning, the spokesperson, told a regular press briefing.

"They are the result of the combined effects of comparative advantages and market laws." The comments came in response to a query on remarks by U.S. President Joe Biden that China provides subsidies to flood the U.S. market with electric vehicles, concerns echoed by other administration officials.

Subsidies cannot make up for industrial competitiveness, Mao said, adding, "There are no prohibited subsidies stipulated by the WTO." New energy products were the result of enterprises' efforts, not government subsidies, Mao added. "Last year, China exported only 13,000 electric vehicles to the United States. How can they flood into the U.S. market?"

Biden has vowed to ratchet up tariffs on a number of Chinese sectors, with measures such as quadrupling import duties on its EVs to more than 100%, while doubling semiconductor duties to 50%.