China and the European Union have increased their commercial spats in recent weeks, with both denouncing
“
unfair
” subsidies from their competitor. Brussels, keen to reduce its dependence on Beijing, published a report on Wednesday on the distortions of competition induced by state aid within the Chinese economy.
Over 700 pages, the European Commission details the impact of China's state planning on certain sectors: steel, aluminum, telecommunications, semiconductors, railway equipment and electric vehicles. Their repeated occurrence in anti-dumping and anti-subsidy investigations in recent years by the EU automatically designates them as the most sensitive sectors. According to a study carried out by the Kiel Institute, the subsidies granted by China to its companies are three to nine times higher than those granted by other OECD countries, such as the United States or Germany.
Overcapacity problem
Taking…