China, European Union agree to hold talks on EV tariffs

China and the European Union agreed to start talks on the bloc’s plans to impose tariffs on electric vehicles imported from the Asian nation. 

Chinese Commerce Minister Wang Wentao and the EU’s Trade Commissioner Valdis Dombrovskis spoke in a video conference Saturday, according to a statement by the commerce ministry in Beijing. They agreed to begin talks, the statement said without providing details.

The EU announced plans to impose levies as high as 48% on EVs shipped from China last week, fueling trade tensions with the Asian nation. The bloc has opened a slew of investigations into China, citing unfair trade practices such as massive state subsidies, prompting Beijing to retaliate with an escalating campaign of threats targeting European goods. 

The negotiations come as Germany’s Vice Chancellor Robert Habeck made a visit to China. Habeck met Wang earlier Saturday and reiterated Europe’s willingness to hold discussions about the tariffs.

“One has to be very careful now, this is a first step and many more will be necessary,” Habeck said to reporters in Shanghai after the agreement to begin talks. “But at least this is a first step that was not possible before. That’s why tonight is a good evening if we want to try to maintain a level playing field and avoid a tariff war.”