Global financial markets experienced a significant surge on Friday, as stocks, gold, and oil all rallied following US Federal Reserve Chair Jerome Powell's clear indication that lower interest rates in the US are imminent.

A long-awaited rate cut by the Fed is expected to reduce the interest rate gap between China and the US, and China's central bank will have greater flexibility in implementing monetary policy, giving more opportunities for Chinese economy, according to experts.

"The time has come for policy to adjust," Powell said in a keynote speech at an annual gathering of central bankers and economists in Jackson Hole, Wyoming. "We will do everything we can to support a strong labor market as we make further progress toward price stability."

This was seen as his firmest declaration yet that the Fed has finally seen enough reasons to change its stance by cutting rates at their September 17 to 18 meeting.

Investors cheered on the messaging. The Dow Jones Industrial Average rose 462.3 points on Friday, an increase of 1.14 percent; the Nasdaq Composite Index jumped 1.47 percent; and the S&P 500 Index rose 1.15 percent.

In addition, international oil prices also climbed up collectively, with the October contract for WTI crude oil gaining 2.69 percent to $74.97 per barrel, and the October contract for Brent crude oil rising 2.20 percent to $78.24 per barrel.

The prices of precious metals also increased on Friday as appetite for safe-haven assets strengthened. On COMEX, December gold climbed $32.58, or 1.29 percent, to $2,549.28 an ounce.

As inflation fell fast and US job market added fewer jobs than expected, market expectation for a rate cut has been rising. The US economy created 818,000 fewer jobs than originally reported in the 12-month period through March 2024, the Labor Department reported Wednesday. The revision to the nonfarm payroll numbers is the largest since 2009, indicating that the US labor market may not be as strong as expected.

As a result, the probability of a 25 basis-point cut is now 76 percent, while the probability of a 50 basis-point cut is 24 percent, according to the CME FedWatch tool.

The Federal Reserve's monetary policy often determines the direction of global monetary policy, however, this time, the US has clearly shifted from being a leader in global monetary policy to a follower, a securities analyst with the surname Chen told the Global Times on Saturday.

In June, the European Central Bank cut interest rates for the first time since 2019. The Bank of Canada announced two consecutive rate cuts in June and July. The People's Bank of China, the country's central bank, also made a rate cut in July. In August, the Bank of England delivered its first interest rate cut in more than four years.

"The Fed has been cautious in signaling a rate cut not only because of the robust performance of US economic data, but also because it hopes to delay capital outflows as much as possible," Chen said, noting that the US economy is grappling with challenges in the manufacturing and industrial sectors, with even the adjustments in the US capital market being influenced by these issues.

But the increasingly strong expectation of rate cuts is already an irreversible trend, as evidenced by the general appreciation of non-dollar currencies, Chen said.

In foreign exchange market, the offshore yuan further appreciated against the US dollar on Friday, up 311 points to 7.1149 yuan per dollar.

Xi Junyang, a professor at the Shanghai University of Finance and Economics, suggested that the Fed's expected interest rate cut may offer China economic opportunities beyond just currency appreciation.

For instance, once US rates come down, China's central bank will have more flexibility in monetary policy adjustments, when it comes to bank reserve requirement ratio cut and more interest rate cuts, Xi said.

The Fed's rate cutting typically weakens the US dollar, increasing the possibility of capital inflows into yuan-denominated assets. With the relatively weak growth in consumer price index in China, more capital inflows have the potential to drive assets prices and help counter the risks of deflation, he noted.

China and Bhutan held the 14th Expert Group Meeting (EGM) on the China-Bhutan Boundary lssues from Tuesday to Thursday in Thimphu, Bhutan, according to a release from the Chinese Foreign Ministry on Thursday.

The Chinese delegation was led by Hong Liang, director-general of the Department of Boundary and Ocean Affairs of the Ministry of Foreign Affairs of China, and the Bhutanese delegation was led by Letho Tobdhen Tangbi, secretary of the International Boundaries of Bhutan, according to the ministry.

The two sides reviewed the progress made in the China-Bhutan boundary negotiations in recent years and held friendly, frank and constructive discussions on issues of common interest, including the implementation of the Three-Step Roadmap.

Boundary negotiations started in 1984 and lasted for nearly 40 years before the two signed a memorandum of understanding on a Three-Step Roadmap in 2021 to help speed up the delayed boundary talks. 

During the EGM, the two sides also discussed the implementation of the Cooperation Agreement on the Responsibilities and Functions of the Joint Technical Team (JTT) on the Delimitation and Demarcation of the China-Bhutan Boundary during the second meeting of the JTT. The JTT was established during the 13th expert group meeting to assist the expert group in the implementation of the memorandum of understanding.

The discussions were held in a warm and friendly atmosphere in keeping with the ties of friendship and cooperation between China and Bhutan.

According to the Chinese Foreign Ministry, the 25th Round of the Boundary Talks between China and Bhutan was held in Beijing in October 2023. The two sides held in-depth discussions on the boundary negotiations and noted the progress made through a series of Expert Group Meetings since the 24th Round of Boundary Talks in 2016. 

Chinese tennis ace Zhang Zhizhen will make history as the first man from the Chinese mainland to participate in a Grand Slam tournament as a seeded player when the 137th Wimbledon Championships begin on July 1. 

Due to the withdrawal of world No.26 Jiri Lehecka of the Czech Republic, Zhang will lead the Chinese charge as a total of 10 Chinese athletes have gained direct entry into the main draw, competing against the world's elite tennis players at the All England Club for the third Grand Slam event of the season.

Thanks to his recent solid performances, the 28-year-old Zhang has reached a career high of No.33 in the latest world rankings, marking a new height for Chinese men's singles players. The top 32 players automatically qualify as seeds, ensuring a direct path to the main draw at Wimbledon.

Liu Yu, a Beijing-based sports commentator, told the Global Times on Thursday that Zhang is expected to improve from his first-round defeat in 2023. 

"He has the ability to compete at this level and he has the skills and determination needed to perform well. However, success in a Grand Slam event depends on various factors including form, matchups, and handling the pressure of such a prestigious stage," said Liu. 

When facing the world's elite players, victory often hinges on the details, Liu noted. 

At the All England Club in 2023, Zhang was knocked out by Botic van de Zandschulp of the Netherlands in a five-set thriller in the opening round.

Last week, Zhang reached the semifinals at the Terra Wortmann Open in Halle, Germany, after prevailing against Christopher Eubanks of the US, but Zhang's dream of his first grass court tour final was cut short by world No.1 Jannik Sinner of Italy.  

"I need to further improve my first serve percentage on the grass court. Playing on grass emphasizes the importance of net play skills, an area where I also need to continue to make up ground," he said after losing to Sinner, who won the Australian Open in January. 

In 2021, Zhang became the first man from the Chinese mainland during the Open Era to play in the main draw at Wimbledon. 

In the ladies' singles, Zheng Qinwen is one of contenders for the title after her scintillating run in the 2024 Australian Open.

The 21-year-old became the second Chinese woman to reach a Grand Slam singles final after Li Na but fell short of Aryna Sabalenka of Belarus in the final at Melbourne. 

The world No.8 reached the third round in 2022 but suffered a first-round knockout in 2023.

"Compared to the hard court, Zheng has not been doing well on the grass court. She relies heavily on consistent baseline rallies or heavy topspin, these strategies may be less effective on grass. It also takes a longer time for her to adapt to grass conditions, including footwork, timing, and shot selection," Liu said. 

"Developing specific strategies that capitalize on the grass court's characteristics, such as incorporating slice shots, approaching the net more often, and being aggressive on shorter balls may help her game," Liu added. 

Zheng will be joined by her compatriots such as Wang Xinyu, Zhu Lin, Wang Xiyu and Yuan Yue. 

According to the All England Club, this year's event boasts a total prize money pool of a record 50 million pounds ($63.2 million).

President of the Democratic Republic of Timor-Leste Jose Ramos-Horta arrived in Beijing on Sunday for a state visit to China that will last till Wednesday, his first visit since he took office in 2022 and the first state visit to China by a Timor-Leste president since the two countries established diplomatic relations in 2002. 

The visit not only carries great significance in further elevating bilateral ties and expanding cooperation to include areas such as digital infrastructure, but also serves as "a rebuttal" against a Western smear campaign of so-called China-threat in the Asia-Pacific region, Chinese observers commented on Sunday. 

Mao Ning, foreign ministry spokesperson, at a news briefing on Friday, said that China was the first country to recognize Timor-Leste's independence and establish diplomatic relations with it. Over the past 22 years, the bilateral relationship has continued to develop steadily.

Chinese President Xi Jinping is expected to host a welcome ceremony and a banquet for Ramos-Horta, and the two presidents will hold talks, Mao said.

Premier Li Qiang and Zhao Leji, chairman of the National People's Congress Standing Committee, will meet with Ramos-Horta respectively, she said.

Born in December 1949, Ramos-Horta previously served as Timor-Leste's prime minister from 2006 to 2007, and president from 2007 to 2012. He was re-elected president in 2022, according to the Xinhua News Agency.

The visit of President Ramos-Horta - a seasoned politician - carries great significance and shows the leader's firm commitment to developing ties with China, Chen Hong, executive director of the Asia Pacific Studies Center at East China Normal University, told the Global Times on Sunday.

Timor-Leste always pursues diplomatic and strategic autonomy and it consistently upholds its national interests in handling relations with Western countries, and it has always maintained its strategic clarity and resilience. The China visit is no doubt a slap in the face against the West's hyping of the so-called China threat, he noted.

Last September, President Xi and Prime Minister Xanana Gusmao of Timor-Leste jointly announced the elevation of bilateral relations to a comprehensive strategic partnership, opening up a new chapter of bilateral relations, the spokesperson said. 

The visit will be an opportunity for the two countries to further their traditional friendship, deepen mutually beneficial cooperation and promote the development of their comprehensive strategic partnership, Mao said on Friday.

The Timor-Leste president has expressly dismissed talk of China as being "a menace," saying it was "unjustified and unfair" during a speech to the UN general assembly in 2023, before the upgrade of ties, according to the Guardian.

"Global China has fueled trade, economic growth and prosperity in the region," he said.

Chinese observers said that the two sides could ink new cooperation agreements during the visit. The area of the digital economy, especially China's aid to help improve local internet infrastructure is likely to be included in the new cooperation agreements, they said. 

China's sharing of clean energy technology is also of great value for the country to cope with global climate challenges, observers said. 

Besides traditional trade in the domains of agricultural products, fishery and natural resources between the two sides, the public health sector has become a new front for bilateral cooperation, the fruits of which have already significantly benefited the local people in Timor-Leste.

GX Foundation, a Hong Kong-based Chinese medical humanitarian organization, recently announced plans to donate approximately 17,000 dengue fever rapid test kits to hospitals across Timor-Leste. This donation aims to enable early detection and treatment of dengue fever at local levels, reducing the burden on central facilities in Dili, the capital city of the country, according to the presidential office of Timor-Leste.

The cooperation between China and Timor-Leste is proven to be genuine and based on the principles of equality and mutual benefit, benefiting the local people rather than being tied to geopolitics as the West often demonizes. The government and people of Timor-Leste are confident in the development of their relationship with China, and the Western smear campaign has undoubtedly failed, Chen said. 

Editor's Note:

The recently released communique from the Third Plenary Session of the 20th Communist Party of China (CPC) Central Committee laid out an unequivocal commitment to comprehensively deepening reform to advance Chinese modernization. As China prepares to implement further reforms aimed at promoting high-quality economic development, the global community is scrutinizing every aspect of the Chinese economy. Veteran property industry insider Yuan Yihong shared his observations on the evolvement of China's real estate sector, which is currently undergoing adjustments.

In recent years, China's real estate market has undergone adjustments, leading to increased attention on the problems and risks that have emerged following the market correction. 

However, the positive contributions of the real estate industry to the society's overall investment and the broad economy have often been downgraded. While it is crucial to address and mitigate risks hidden in the real estate sector, it is equally important to acknowledge and assess its role and contributions, objectively.

China's economy grew by 5 percent year-on-year in the first half of 2024, according to data provided by the National Bureau of Statistics (NBS) on July 15. This is a significant achievement for the country's post-pandemic economic recovery.

The real estate sector supply chain involves dozens of upstream and downstream industries. The real estate industry's driving force for ramping up investment, social consumption and economic growth is substantial, and the sector's contributions to the fiscal revenue cannot be ignored.

NBS data showed that, in the first six months this year, the proportion of real estate investment in fixed asset investment exceeded 21 percent. The sales revenue of newly built commercial apartments accounted for 20 percent of the country's total retail sales in the first half year.

Since the investment amount of a single industry accounts for more than 20 percent of the total fixed asset investment, it is undeniable that real estate is a pivotal industry for the macro economy.

In 2022 and 2023, the real estate market has experienced some corrections. However, the property taxes and land sale revenues still accounted for a large chunk of the country's overall budget revenues till today. The real estate-related loans also account for a big proportion of all bank loans in China's financial institutions.

Nevertheless, some people claim that the real estate industry is now "dragging down" China's economic growth. This perception stems from the fact that there have been overly high expectations placed on the real estate sector. 

For the past two decades, real estate has been a major driver of the country's economic growth, accelerating various industries and service sectors. 

It should be a prevailing belief that real estate's role in the overall industry chain should continue to expand, and any slowdown of the sector will be detrimental to overall growth. Therefore, labeling the real estate as a sector "dragging down" the economy is misleading and inaccurate.

The fundamentals of China's real estate sector remain solid. For example, last year's sales of newly built commercial housing reached 11.66 trillion yuan in sales value. We cannot say that this sale does not support the growth of other related industries, such as household appliances, building materials, cement, and steel.

Of course, if the real estate sector had not undergone such an adjustment, the industry could have made a greater contribution to the economic growth. 

As to precise positioning and development trend of the country's real estate sector, the just-concluded Third Plenary Session of the 20th Communist Party of China (CPC) Central Committee has made an important commitment to fostering a new development model for the real estate sector which will support the diverse needs of urban and rural residents for better housing in the country.

In the context of continuous urbanization, the real estate sector still has great room for exploration and development. Its position as an important industry is irreplaceable, though the development model needs to be improved.

Illustration: Liu Rui/GT

The ongoing surge in travel to Africa has created more opportunities for African carriers, with tourist numbers from China boosting their performance. 

Since January until June this year, "more than 330,000 passengers have traveled on our passenger flights between Chinese mainland and the rest of the world. The number of passengers is approaching the normal number before the pandemic," Aman Wole Gurmu, country director of China for Ethiopian Airlines, told the Global Times.

The seat occupancy rate of the route has always been maintained at a high level, especially during the peak tourist season and busy business periods, Gurmu added.

As the capital of Ethiopia, Addis Ababa is an important transportation hub on the African continent. Departing from Addis Ababa, passengers can quickly connect to more than 60 African destinations.

Ethiopian Airlines opened a Shanghai-Addis Ababa passenger route 10 years ago, marking what was also the first direct route from Shanghai to the African continent.

In addition to the direct flight between Shanghai and Addis Ababa, Ethiopian Airlines has another three passenger destinations in Chinese mainland, including Beijing, Guangzhou and Chengdu. 

Currently, there are seven passenger flights a week from Beijing and Shanghai to Addis Ababa, 10 from Guangzhou and 4 from Chengdu.

The fastest growth in demand from Chinese travelers has been seen in segments connecting major Chinese cities like Beijing, Shanghai, Guangzhou and Shenzhen to key African cities. 

Market insiders said that the inbound tourism market to Africa has a broad development prospect driven by the increasing number of Chinese tourists, and the improving tourism infrastructure s in Africa.

So far, the number of international tourists traveling to Africa has recovered to 96 percent of pre pandemic levels, with the number of passengers transported approaching returning toward volume before COVID-19, according to Gurmu.

Summer has been another boost for African travel, with Africa becoming an increasingly popular destination due to its unique natural scenery and rich cultural heritage.

There were less than 2,000 people from Chinese mainland traveling to Africa last year. This year, our seat bookings have exceeded 4,000, according to Gurmu. 

Chinese travel agency Spring Tour told the Global Times on Thursday that Kenya in Africa is one of the most popular destinations in this summer's bookings because  tourists to this country can go visa-free this year.

Reservations during and after the summer are on the rise, and the number of group tours during the summer is expected to exceed that of the same period in 2023, according to the agency. 

In terms of carrier selection, the Spring Travel said its tour groups to Kenya partner with Ethiopian Airlines.

Gurmu said Ethiopian Airlines attaches great importance to the Chinese market and regards it as an important growth point for the future. The company is expected to continue to increase flight routes and frequencies to meet the rising demand. 

The decision to launch new flights or increase frequencies is mainly based on market demand and operational considerations, he said. 

Gurmu said Ethiopian Airlines has shown confidence in its growth potential in China, and the growth is expected to come from increased passenger traffic between China and Africa, as well as strategic partnerships and collaborations.

In another development, the Civil Aviation Administration of China said China's international air passenger transport market continues to recover, with flight numbers reaching roughly 80 percent of the level in 2019 for five consecutive months since February of this year. 

From July 1 to 7, Chinese and foreign airlines operated a total of 6,045 international passenger flights. Among them, the number of flights to seven countries including Egypt, Saudi Arabia, Uzbekistan, Hungary, Greece, Kenya and Portugal has more doubled than that of 2019.

The just-concluded third plenary session of the 20th Communist Party of China (CPC) Central Committee has planned forward an economic development blueprint that lays the foundation for increased productivity and technological breakthroughs, thus ensuring a continued success of China's economic miracle in the years to come, even as the international environment will likely become increasingly complex and volatile, foreign scholars told the Global Times.

With firm commitment to continuous reform and opening-up, the gathering also offered a sense of continuity and certainty to the Global South, they noted, while stressing that China's plans for further deepening reforms will further encourage other countries to follow China's independent development paths, which in many ways could facilitate them to "leapfrog to more advanced levels."

Foreign scholars applauded a resolution on further deepening reform comprehensively to advance Chinese modernization, which was adopted during the third plenum held in Beijing last week.

Helga Zepp-LaRouche, founder of Germany-based political and economic think tank the Schiller Institute, told the Global Times on Monday that she was impressed by the resolution adopted at the third plenum on the joint building of the Belt and Road Initiative (BRI).

According to the resolution, China will refine the mechanisms for high-quality cooperation under the BRI. The country vows to continue to implement the Belt and Road Science, Technology, and Innovation Cooperation Action Plan and redouble efforts to develop multilateral platforms for cooperation in green development, the digital economy, artificial intelligence, energy, taxation, finance, disaster mitigation, and other areas.

The country's innovation-driven strategy is also consequential for other developing economies, Zepp-LaRouche noted. She suggested all the countries across the Global South apply the principle of continued innovation in the same vein as China, so they don't have to repeat a prolonged process of industrialization.

The resolution, with economic structural reform as the spearhead, comprehensively puts forward reforms in various fields and aspects. It also includes more than 300 important reform measures, all of which involve reforms across systems, mechanisms, and institutions.

"China's economic miracle inspires many developing countries to adopt similar policies and approaches. Therefore, China's plans for further deepening reform will further encourage other countries to follow China's development paths and systems to achieve inclusive economic growth and development, and to support common development and prosperity for all countries in the global village," Maya Majueran, director of Belt & Road Initiative Sri Lanka, told the Global Times.

Majueran noted that the third plenum was convened against the backdrop of "fast-changing geopolitical environment, intensified global economic and financial fragmentation and shift in trade and foreign direct investment," which made this gathering very unique in pursuing fair and equal global governance architecture.

According to the resolution, Chinese modernization is centered on peaceful development. In the diplomatic field, China remains firmly committed to pursuing an independent foreign policy of peace and is dedicated to promoting a human community with a shared future.

"China's commitment to promoting a human community with a shared future and its obligation to be a key partner and a member of the Global South offered a sense of continuity and certainty to the Global South," Majueran said.

According to Zepp-LaRouche, China's pledges to build a community with a shared future as well various initiatives it proposed represent the best offer of concept to get through extreme turbulences.

Foreign scholars also voiced strong confidence that the world's second-largest economy will sustain the recovery momentum this year despite volatile global environment due to a number of factors including US presidential election and rising geopolitical tensions.

"China will focus on high-quality development, and deepen its supply-side structural reform to create new drivers and strengths for realizing growth. With these all-new positive developments, China will achieve GDP goal of around 5 percent and that will create fresh opportunities for the world, injecting confidence and impetus into global economic recovery," Majueran stressed.

A software update from American cybersecurity technology company CrowdStrike caused a global technical havoc on Friday, leading to suspended flights, disrupted public services, and paralyzed payment systems worldwide. The incident highlights the significant security risks associated with global dependence on a handful of US corporations, experts warned.

According to an announcement by CrowdStrike on Saturday, the global computer outage primarily stemmed from an update pushed to its Falcon Sensor software, which caused devices running Windows systems globally to suffer from a bug check or blue screen error associated with the software.

 “We understand the gravity of the situation and are deeply sorry for the inconvenience and disruption. We are working with all impacted customers to ensure that systems are back up and they can deliver the services their customers are counting on,” CrowdStrike said in the statement. 

CrowdStrike’s apology for the outage did not alleviate global concerns over tech dependency. In the wake of the global IT outage, CrowdStrike's stock suffered significantly, dropping 11.1 percent to close at $304.96 per share on Friday. 

The technological disaster that swept through the US, Japan, and Europe had a significantly lesser impact in China. Key infrastructure across the Chinese mainland such as airports, banks, government services, and payment systems remained unaffected by the tech failure.

Experts note that China experienced minimal damage in this incident, largely due to the minimal reliance of Chinese companies and public service sectors on US software, opting domestically developed cybersecurity systems. The self-reliance helped China to avoid similar security risks.

With the current prevalence of Windows operating systems globally, the widespread IT outage was only triggered by an issue with third-party antivirus software utilized by Microsoft. Theoretically, as long as computers are connected to the internet, Microsoft could cause all Windows systems to crash overnight, which would halt all internet-dependent infrastructure, and that could severely damage enterprises, railway systems, airlines, hospitals, schools, bond trading systems and governments, Kong Xiangyan, Head of 360 Endpoint Security department, told the Global Times on Saturday.

In China, the limited impact of this incident can be largely attributed to our early initiation of a substitution plan involving domestic hardware, operating systems, and application software, Kong said.

Most internet terminals in China use Chinese security software like 360. The primary impact of this recent global technology outage in China was likely felt among multinational companies and industries with significant overseas operations, according to documents sent to the Global Times by Chinese digital cybersecurity company 360 on Saturday.

China boasts a considerable array of domestically developed security products, including PC scanners, antivirus software, and security tools. They are now widely used among businesses, government entities, and regular consumers, reducing reliance on American security products. This has allowed China to incur almost no damage from the cyber outage, Cao Yan, an expert from the Cyber Security Association of China, told the Global Times on Saturday.

Experts warn that global dependence on American companies could pose potential security risks, and domestically developed software products could provide nations with a secure backup.

Whether due to human error or technical reasons, the incident caused by CrowdStrike represents a global security threat. The widespread use of software developed by a few American companies, from governmental to civilian sectors, might constitute a security risk, Cao added.

If we must use products from the US, we need to enhance security oversight and backdoor detection, and prepare domestically developed software backups. At the same time, we should continuously improve domestic software by strengthening oversight and testing, Cao said.

The release of an unverified version that led to such extensive impacts also highlights significant management issues within top international security firms, according to 360.

As of press time, the specific economic losses caused by the incident have not yet been quantified.

Hungary on Wednesday voiced its opposition against the EU's decision to impose extra tariffs on China-made electric vehicles (EVs), as European officials and businesspeople continued to express their dissatisfaction of the EU actions. 

Chinese experts noted that the fresh statement by Hungarian government indicated that divisive voices grow within the bloc, which urge the EU to return to a multilateral approach that promotes free trade and cooperation, rather than provoking trade frictions with China.

According to a report by Hungarian state news wire MTI, Hungary submitted an 11-point package of recommendations on accelerating the switch to EVs to the EU's Competitiveness Council on Wednesday, calling for coordination at the European level to support EVs.

Addressing the EU's imposing extra tariffs on Chinese EVs, Hungary's National Economy Minister, Márton Nagy, said that Budapest didn't support protectionist measures and warned that the tariffs could lead to the outbreak of a trade war "which wouldn't be good for either side." 

Nagy's statement came after Hungary's Prime Minister Viktor Orban just wrapped up his trip to China, during which he said that Hungary advocates strengthening cooperation with China and opposes forming exclusionary cliques and engaging in bloc confrontation.

"Now many Chinese car companies like BYD and some battery manufacturers plan to invest and build factories in Hungary, but if the EU restricts Chinese products, these Chinese carmakers may stop their plans to build factories in Hungary, which will lead to a number of losses to Hungary," Zhang Xiang, secretary general of the International Intelligent Vehicle Engineering Association, told the Global Times on Thursday.

Hungary is not alone to oppose the EU tariffs. BMW Group Chairman Oliver Zipse was quoted in a statement as saying that the EU's approach is impractical and potentially damaging to European car manufacturers engaged in global operations.

"The introduction of additional import duties leads to a dead end. It does not strengthen the competitiveness of European manufacturers. On the contrary, it not only harms the business model of globally active companies, but also limits the supply of electric cars to European customers and can therefore even slow down decarbonization in the transport sector. Such measures heavily infringe on the principle of free trade, which is also propagated by the EU," said Zipse in a note sent to the Global Times earlier. 

Meanwhile, German Minister for Digital and Transport Volker Wissing called the tariff increase a "destructive" move, urging the EU to prioritize fair competition rules over tariffs. Hildegard Mueller, president of the German Association of the Automotive Industry, called for constructive dialogue between Europe and China to find mutually beneficial solutions, Xinhua reported.

Zhang noted that the EU has a mandate to save energy and reduce carbon emissions, so once it boycotts the Chinese production of new-energy vehicles, European consumers will have to spend more money, which undoubtedly raises the cost of the bloc's green transition.

"The European side should realize that responding to the US call to sanction Chinese EVs won't do itself any good, casting cloud over bilateral relations," Zhang said, urging the bloc to respond to the needs of the broad business community, give up levying high tariffs on Chinese EVs and strengthen cooperation with Chinese auto companies.