| The global liberal order has long been written off. It was naïve, the argument now goes, to think that trade would bind together countries’ interests and encourage cooperation over conflict. But Europe’s current China contortions suggest that global trade can still keep the peace. Today was long signposted as the day the European Commission would announce punitive tariffs on Chinese electric vehicle (EVs) imports. The announcement, strategically timed just before Europeans go to the polls, would have sent a clear signal that Europe was committed to protecting its treasured automobile sector. But instead, silence. The announcement is now delayed until 10 June – a day after the elections end. And the chatter in Brussels is now focused on potential trade negotiation – rather than a trade war – with the Chinese. There were already calls across Europe to favour dialogue over tariffs. But recent developments have further emboldened these voices. China sent a five-page letter to the Commission, which threatened countermeasures if Europe slapped tariffs on their EVs, but which also held the door open for talks. In truth, the benefits to Europe from imposing tariffs were always questionable: It is genuinely unclear if tariffs on Chinese EVs would help or hinder European carmakers. Years of trade between Europe and China have already deeply entangled their respective automobile industries. Some 40% of Volkswagen sales are in China, also BMW’s second-largest market. Ownership is entangled, too as the Chinese state indirectly owns 20% of Mercedes. These and other European carmakers now produce millions of cars in China yearly, often via joint ventures with local players. This entanglement means that the interests of European and Chinese car makers are difficult to separate. It is no wonder many voices in Europe are urging caution – including those from within the continent’s automotive sector. | 