Amid China-EU tensions, former Finnish official warns of societal harm from tariffs

Amid rising tensions between China and the European Union, former Finnish Prime Minister Mari Kiviniemi emphasized the need for Beijing to address the EU's concerns regarding its overseas projects and technologies.

Speaking at the Asian Infrastructure Investment Bank (AIIB) conference in Samarkand, Uzbekistan, Kiviniemi expressed her worries about the harmful effects of protectionism and tariffs on the global economy, noting that such measures ultimately impact society as a whole, Caliber.Az reports via foreign media.

Kiviniemi, who served as Finland's prime minister from 2010 to 2011 and later as deputy secretary-general of the OECD, pointed out that economic relations between China and the EU have deteriorated this year, particularly following the EU's decision to impose additional import tariffs on major Chinese electric vehicle manufacturers. These tariffs, ranging from 17.4 per cent to 37.6 per cent, have sparked fears of a potential trade war, leading to retaliatory actions from Beijing.

China's commerce minister, Wang Wentao, recently held discussions with EU Trade Commissioner Valdis Dombrovskis, but no concrete agreements were reached. Both parties committed to working toward a mutually acceptable resolution. Tensions escalated when China sought arbitration from the World Trade Organization regarding the EU's tariffs, prompting Brussels to challenge China’s investigation into EU dairy products.

Kiviniemi acknowledged that the current situation is concerning and stressed the importance of addressing the EU and US security apprehensions regarding Chinese companies. She highlighted the need for openness and transparency as key remedies for these fears.

Finland, a founding member of the AIIB and part of China’s Belt and Road Initiative, has experienced a decline in bilateral trade with China, which fell by 2.9 per cent to $5.58 billion in the first eight months of the year. Finnish projects, including a proposed tunnel between Helsinki and Tallinn, faced delays due to concerns over Chinese involvement, though developers are reportedly moving forward with plans and still seeking Chinese partnerships.

Kiviniemi reiterated the importance of open dialogue to alleviate security concerns, stating, “Transparency is really the key.” Overall, trade between China and the EU has also declined by 1 per cent in the same period, totalling $523.1 billion.