Thursday, September 12, 2024

UK and Mauritius Resume Talks Over Diego Garcia, a Key U.S. Naval Base

B-1B — The bomber flight line and the strategic anchorage at Diego Garcia (USAF)`

The new British government has resumed talks with Mauritius on the future of Diego Garcia in the Indian Ocean, the previous government having suspended the negotiations. The United Kingdom has owned Diego Garcia within the Chagos Archipelago since 1814, and until recently it has rebuffed attempts by Mauritius to assert that the archipelago should have been transferred when the island nation gained independence from Britain in 1968.

The resumption of talks comes at a delicate time. The United Kingdom has leased the island of Diego Garcia to the United States for its exclusive use as a military base since 1966. The lease to the United States runs until 2036, with a renewal option thereafter, and there is no clause for early termination.

The United States maintains a major airfield on Diego Garcia, as well as a naval base, which can host submarines and all classes of surface vessels. The protected lagoon is used as an anchorage for ships of Maritime Prepositioning Ships Squadron Two, a strategic logistic reserve kept afloat and ready for use by U.S. Marines and the U.S. Army in the Middle East region. When needed, the airfield becomes a key base for long-range strike and reconnaissance aircraft, and it was used extensively during the wars in Iraq and Afghanistan. With the US Navy carriers USS Abraham Lincoln and USS Theodore Roosevelt both positioned off Iran - an ominous pairing - the value of Diego Garcia as a strategic backstop has probably never been more apparent.

Generally dismissed as being in the middle of nowhere, Diego Garcia also now finds itself in the increasingly busy sea-lane between the Straits of Malacca and the Cape of Good Hope, which now carries extra traffic previously served by the Suez Canal.

In these circumstances, the United States is likely to push back on a number of solutions to the future of Diego Garcia now being discussed between the United Kingdom and Mauritius, which variously threaten the secure operations of the base. A particular concern arises from Mauritius’ warming relationship with China.

Relations between the United States and the United Kingdom in the defence and security field have been under some strain in recent months. The new Labour government talked up a possible increase in defense spending during the recent UK election, but once in power, cuts in defense programs appear more likely. The withdrawal of a small number of arms export licences to Israel was announced in a manner that managed to upset both Israel and the United States, without placating the pro-Palestinian lobby it sought to appease. Tensions persist over arms exports and permissions granted to Ukraine over the use of long-range weapons. Diego Garcia could be another contentious issue on the agenda of talks between President Biden and Prime Minister Starmer in Washington next week, given America's investment in the atoll's future.

Jonathan Campbell-James has a degree in Modern Middle Eastern Studies from Durham University and served for 32 years in the British Army’s Intelligence Corps. His career focused on the Gulf and culminated as Deputy C2 Intelligence in HQ Multinational Forces-Iraq in Baghdad. He was then the Regional Head of Security and Political Risk covering the MENA Region for a global bank, based in Dubai and Riyadh. He also has written for the Washington Institute for Near East Policy and for Gulf States Newsletter. He is a graduate of the Army Staff College, the Defence School of Languages and the NATO Defence College Rome.

The opinions expressed herein are the author's and not necessarily those of The Maritime Executive.

Turkish Cargo Ship Abandoned After Collision Off Iran

Turkish authorities are reporting that the crew of a Turkish-owned and managed cargo ship are safe after a collision with a bulker off the coast of Iran. Circumstances of the collision were not provided but the crew was rescued from a life raft after the vessels collided.

The Turkish General Directorate of Maritime Affairs (DSGM) reports that the rescue centers in Ankara and Bandar Abbas coordinated for the rescue of the crew from the Knidos, a Turkish-owned general cargo ship managed by Elkenz Shipping of Istanbul. The 8,900 dwt vessel was reporting that it was outbound from the Dammam Port in Saudi Arabia bound for the Mina Saqr Port in the United Arab Emirates.

Shortly after midnight local time a signal was received from the EPIRB emergency system on the Knidos. The authorities are reporting that the 13 crewmembers abandoned ship after colliding with the Nadeen (28,396 dwt) a bulker inbound from India.

According to the report, Knidos was hit starboard stern quarter and the engine room began taking on water. The 423-foot (129-meter) vessel was reported to be in danger of capsizing.

The crew was rescued from the raft and taken aboard the Nadeen. The bulker is registered in St. Vincent & Grenadines and managed from the UAE.

No injuries were being reported. The Nadeen’s AIS signal shows the vessel underway but no port is declared.

Cargo Ship Loaded with Dangerous Ammonium Nitrate Seeks Port in Lithuania

Klaipeda Lithuania — Klaipeda, Lithuania is considering offloading the dangerous cargo so the ship can undergo repairs (Port Authority file photo)

The cargo ship Ruby which caused a controversy in Tromsø, Norway when it was discovered it is carrying ammonia nitrate is again on the move with reports it is seeking permission to enter the Port of Klaipeda, Lithuania to undergo reports. The ship reported suffered damage to its rudder and propeller which caused it first to seek refuge in Norway and now has Malta as its port state and DNV as its class reviewing the alternative solutions.

The Ruby (37,000 dwt) registered in Malta and managed from the UAE was loaded in August with 20,000 tons of ammonium nitrate, a volatile compound that when placed under the right conditions can be explosive. It is cited as the source of the explosion that damaged large parts of Beirut four years ago as well as other incidents. The cargo was loaded in Russia and bound for the Canary Islands.

Norwegian authorities have been conferring with Malta and DNV since it was discovered that the vessel was damaged, although public reports have not cited when or how the damage occurred. The vessel sought refuge from an Arctic storm in Norway’s sheltered waters and was later permitted to dock in Tromsø. The Norwegian authorities assert they were not aware of the hull damage or the nature of the cargo but when the dangers were reported in the media Norway ordered the ship to leave the port.

The ship was brought a week ago to anchorage approximately two miles southeast of Vannøy, Norway. A 500-meter (1,600-foot) safety zone was established around the ship while the Norwegian authorities said the “distance is considered sufficient,” for the safety of the population.

The Klaipeda State Seaport Authority confirmed to the Lithuanian media that the Ruby has applied for permission to enter the port. They said the plan is to offload the ammonium nitrate so that the ship could enter one of the shipyards in the port for repairs.

The authorities told the local media they are “assessing the circumstances carefully.” A decision is expected “in the near future.”

The vessel’s AIS signal shows it is underway bound for the remote Norwegian settlement of Andenes (population approximately 2,500) in the northern reaches of the country. The transmission reports the vessel arriving on Thursday, September 12. It could be a service call to replenish stores or relieve the crew.

The Norwegian authorities stressed that they believed the ship after being repositioned did not pose any greater danger than while in normal operations. However, they were continuing to monitor the situation and are in contact with the authorities in Malta and DNV reviewing any solutions or alternatives developed for the situation.

UPDATE

Wreck Hunters Find Lost Steamship From the 19th Century off Cape Cod

Times of London / public domain (via Jennifer Sellitti)

A group of wreck hunters from New Jersey have discovered the location of an early steamship that went down off Massachusetts more than 150 years ago. The resting place of the passenger vessel Le Lyonnais was thought to be located near Nantucket Shoals, but the team found her near Georges Bank, roughly 80-100 nautical miles to the east.

On Nov 2, 1856, Le Lyonnais was under way on a voyage from the U.S. to Le Havre with 132 passengers on board. It was her first return voyage to her home port, but she would never arrive: off the coast of Massachusetts, she collided with the sailing vessel SS Adriatic, an 800-ton cargo ship that was headed southbound for Savannah. The collision caused minor damage to Le Lyonnais' iron hull, and she continued on her voyage. Days later, she succumbed to flooding and sank. Though she deployed lifeboats, only 16 passengers were ultimately rescued alive.

160 years later, a group of amateur explorers set out to find the wreck of Le Lyonnais. The owners of Atlantic Wreck Salvage - the holding company for the dive boat D/V Tenacious - began looking for the vessel together in 2016, and they theorized that the ship may have sunk far from where it was commonly believed to have gone down. Based on survivor accounts, they determined that the ship probably sank near Georges Bank - a shallow area east of Cape Cod.

The team carried out side-scan sonar surveys in 2022-23, then returned last month with four divers to examine each potential target. One of them was clearly Le Lyonnais: the steam engine matched the vessel's equipment, and the iron hull and wooden rigging aligned with the passenger ship's design.

The majority of the ship is buried in the sand, group partner Jennifer Sellitti told the Asbury Park Press. The team is keeping the vessel's location and depth a secret for now, at least until they have an opportunity to examine it further.

US Retailers Accelerate Imports Ahead of Potential East/Gulf Coast Dock Strike

Port of NY/NJ — New York and other U.S. ports reported strong increases in July volume as retailers accelerated shipments ahead of a potential strike (CMA CGM file photo)

With container shipping moving into its traditional peak season, U.S. retailers are expected to further accelerate shipping ahead of a potential longshore strike that is looking increasingly likely for October 1. The forecast is for strong increases in volume this month coming as many U.S. ports are already running at record levels.

The two sides in the U.S. East and Gulf Coast longshore contract negotiations remain at an impasse with the International Longshoremen’s Association increasing its rhetoric. The employers represented by the U.S. Maritime Alliance issued a statement on Friday calling for the union to come to the negotiating table for the master contract.

The ILA issued a letter to members over the weekend (posted online as well) citing inflation and the need for long-term wage security. The union “outright rejects” the position of the USMX on wages, including the entry level positions, which the employers called “an industry leading wage.” The union is calling for improved pensions, better health coverage, and a hardship provision in its healthcare coverage. Most significantly, the ILA said it wanted to be clear “We don’t want any form of semi-automation or full automation.”

With the union digging in and just three weeks to the contract expiration the National Retail Federation reports retailers have brought forward shipments which contributed they believe in a “bumping up” in June through September import volumes. In addition to the looming strike, they point out fears of “rising tariffs following the election.”

“This is a critical time as retailers prepare for the all-important holiday season, and we need every port in the country working at full capacity. Many retailers have brought cargo in early and shifted to alternate ports as a precaution,” said Jonathan Gold, Vice President for Supply Chain and Customs Policy for the NRF.

The retail trade group raised its September forecast to a total import volume of 2.31 million TEU, which is 10 percent ahead of its forecast in July and up by nearly seven percent over the forecast it issued a month ago. The NRF projects for the third quarter volumes will be up more than seven percent from its outlook two months ago to a total of seven million TEU. Further, the trade group points out that April to October will be a seven-month string of volumes of over two million TEU per month, the first since 2022.

The NRF has kept its forecast for the fourth quarter flat year-over-year. This compares with 20 percent increases year-over-year in July and August.

The rush to bring forward shipments may have contributed to the records reported at many of the top ports in the U.S. The Port of New York and New Jersey, for example, reported its best July ever for total volumes. It was also the seventh busiest month ever for the port. Volume was up 11 percent versus 2023 with NY/NJ handling a total of 806,015 TEU. Similarly, on the West Coast, the two largest ports, the Port of Los Angeles (939,600 TEU) and the Port of Long Beach (882,376 TEU) each reported their busiest July volumes.

The NRF has forecast that U.S. retail sales, excluding automobile dealers, gasoline stations, and restaurants, will be up between 2.5 and 3.5 percent this year. They projected that container imports will be up more than 12 percent for the year to just under 25 million TEU. That would be the third busiest year ever for U.S. imports and just shy of the records in 2021 and 2022 when imports topped 25 million TEU.

Maritime Union of Australia Plans Industrial Actions at Bulk/General Ports

Australian bulk port — Union plans industrial actions starting in three bulk and general cargo ports in Australia against operator Qube (Qube)

Dockworkers at some of Australia’s leading bulk and general cargo ports are the latest planning job actions as their contract negotiations drag on. The National Maritime Union of Australia (MUA) reports it received 100 percent support for industrial actions in Melbourne and Port Kembla and over 99 percent for an action in Brisbane all targeting integrated terminal operator Qube.

The contract for the “wharfies” expired in June 2024 with the union accusing Qube of delaying negotiations and reaching new terms. The MUA said they had “been seeking early, cooperative negotiations with management of Qube since October 2023.”

The issues cited by the union sound familiar as they reoccur with striking similarity around the world from Europe to North America to Australia. For most of the summer, Germany’s container ports were without a contract and only reached tentative terms last week after five rounds of strikes. Canadian dock workers are also moving towards a strike while in the United States, the International Longshoremen’s Association appears to be set for a strike that would run the length of the Atlantic Coast and into the Gulf Coast ports impacting containers and RoRo traffic.

The MUA cites the increased profits of Qube over the past four years during the life of the recently expired contract. They note the hard work of the dockworkers, especially during the pandemic, and highlight the impact of inflation.

“The purchasing power of a Qube wharfie has been diminished by 14 percent due to inflation, with the real value of wages falling year on year as company profits rose,” writes the MUA. Discussing the pending actions against Que, the MUA’s Deputy National Secretary Warren Smith said “We are going to fight to get our share.”

With the mandate from members, the MUA says it will begin actions this week in Melbourne, Port Kembla, and Brisbane. The first round will focus on bans on overtime and other changes in work assignments as well as limitations on members. The union also has the authorization for work stoppages ranging from 1 to 24 hours as well as similar tactics for the limited withdrawal of members. The MUA cites the flexibility in the authorization as it moves forward with the actions against Qube.

Recently Australia has seen several long and contentious labor situations that persisted for long periods and resulted in government interventions.

“Companies like DP World and Svitzer Tugs have learned the hard way that workers’ rights and a fair pay rise during rampant inflation are non-negotiable, and the contortions and manipulations they engage in along the way make no difference to the final outcome,” said Smith.

The dispute with Svitzer dragged on for years while actions against DP World impacted container operations. Both of those disputes ended up involving Australia’s Fair Work Commission before settlements were reached.

Qube highlights its port operations and logistics services including bulk and general handling facilities in over 40 Australian, New Zealand, and South East Asian ports. Its operations range from containers to bulk, automotive, and general cargo, and it also manages 25 sites for the forestry industry in Australia and New Zealand. It is also the leading provider of supply chain logistics services to the energy sector, supporting thousands of onshore wells and rig supply vessels, barges, and offshore construction vessels annually.

AFRICA IS A COUNTRY

Malawi: Aflatoxin Kills Hundreds of Dogs in Southern Malawi

11 September 2024
Voice of America (Washington, DC)

By Lameck Masina

Blantyre, Malawi — Malawi has recently recorded the sudden deaths of dogs that consumed meals prepared from maize husks contaminated with aflatoxins.

Veterinary experts say the country has recorded 450 dog deaths since April, when the first cases were identified in Malawi's commercial city, Blantyre.

Aflatoxins are toxic substances produced by fungi that grow on pet food ingredients like peanuts, corn and other grains. Experts warn that the accumulation of those toxins in an animal's body can lead to liver damage, blood clotting and, in severe cases, death.

Timothy Banda is the veterinary clinic manager at the Blantyre Society for the Protection and Care of Animals, which has been testing the dogs. He told VOA that symptoms include a yellowish tint on the dog's skin, hemorrhagic diarrhea or bloody diarrhea, and sometimes vomiting.

"For the past two, three weeks, we haven't received any death from the problem," he said. "But from the time it started somewhere around April up to somewhere around early August, the estimations could be somewhere around 450 dogs so far have died."

He said the aflatoxin contamination was suspected after it was observed that the dogs were not responding to treatment.

"Under normal circumstances, once we started the right treatment, we could get good results, but in this scenario, they were all dying despite whatever treatment was given. Nothing could work out," Banda said.

Banda said the affected dogs were those fed with nsima, a thick porridge prepared from maize or maize husks.

Alfred Manda, a resident of Chirimba township, told VOA that he lost three dogs in August.

"The kind of food I mostly give out to my dogs is nsima flour made from leftover maize called madeya," he said. "To me, I thought it was a healthy diet. I wish I knew earlier. I could have done things better to save my dogs, but unfortunately this is the sad reality that I have faced."

Health experts warn that aflatoxins can also cause tumors in the livers of animals and humans. But health officials in Malawi, where maize is the staple food, have not reported any human deaths resulting from consuming contaminated maize.

In Zambia, media reports indicate over 400 dogs died in July after consuming maize meal contaminated with aflatoxins.

Malawi authorities are advising dog owners to switch to alternative foods, such as rice, until the problem is contained.

AU agency welcomes China's support for African agricultural industry

12-Sep-2024
CGTN

An African Union agency that focuses on capacity building has welcomed China's pledge to support Africa in further developing its agricultural industry and addressing the effects of climate change. /CFP

An African Union (AU) agency that focuses on capacity building has welcomed China's pledge to support Africa in further developing its agricultural industry and addressing the effects of climate change.

At the 2024 Summit of the Forum on China-Africa Cooperation (FOCAC) held in Beijing last week, China promised to expand its cooperation with Africa and implement 10 partnership actions over the next three years.

In the agricultural sector, China pledged to support Africa's further development through various initiatives, including the construction of standardized agricultural demonstration centers, the deployment of Chinese agricultural experts, and the creation of a China-Africa agricultural scientific and technological innovation alliance.

Mamadou Biteye, executive secretary of the Harare-based African Capacity Building Foundation (ACBF), told Xinhua in a recent interview that Africa would benefit immensely from the knowledge, innovation and expertise of Chinese agricultural experts.

"China is a very important partner to Africa especially as we come out of the FOCAC Summit and some important announcements have been made. This includes capacity building through the deployment of Chinese experts to support agriculture productivity in Africa," Biteye said.

China's continued support for Africa's infrastructure development, particularly climate change-related and resilient infrastructure, is crucial to Africa's efforts to modernize and combat climate change, he added.

"China can share its experiences in agricultural development, including research on developing new varieties of crops, such as drought-resistant rice and other food crops, which can adapt well and provide high yields to support the growth of Africa's agriculture sector," Biteye said. He added that increased Chinese support in agriculture could help Africa reduce its food import bill and enable the continent to achieve food sovereignty.

"Innovation and knowledge sharing are extremely important, and I believe these are critical areas where China can play a leading role in Africa," he said.

Biteye's comments came as the ACBF is set to hold its 10th Africa Think Tank Summit, which will explore strategies for sustainable climate financing in Africa from October 8 to 11 in Abidjan, the largest city in Cote d'Ivoire.

There is a need for institutional and policy strengthening in Africa to ensure that the continent can effectively utilize climate financing resources, Biteye said.

Source(s): Xinhua News Agency

The risks and rewards of AI in Africa

Issued on: 12/09/2024 -

Tech leaders, academics, policymakers and entrepreneurs from across Africa and beyond have gathered in Nigeria to discuss the opportunities and challenges raised by the development and use of artificial intelligence (AI). The 2024 Pan-African AI Conference in Lagos, co-hosted by the United States, is seen as a significant step in Africa’s technological future.

Rewriting the Story of Horses and Human History

by William T. Taylor

September 12, 2024
Facebook

In our world today, it’s pretty unusual to see a horse riding down the street. In most cities and towns around the world, horses have retreated to the edges of daily life – appearing more often in sporting events or novelty tourist trips than in daily commutes for most of us. But it was only few decades ago that horses formed the fabric of life all over the world, functioning in everything from transportation to communication, agriculture, trade, and culture. How did this tremendously important relationship between humans and horses first emerge? And where is it headed?

To answer this question, archaeologists around the world have been seeking clues in the artifacts left behind by ancient people, and especially in the bones of ancient horses themselves. New scientific techniques, from archaeozoology to ancient DNA, are starting to shed light on when, where, and how horses were first domesticated, and how they spread across the ancient world–shaking the foundations of what we thought we knew about the human-horse past.

In my own fieldwork in the Mongolian steppes, archaeologists and herders alike still mount astride horses to traverse the mountains and prairies that hold important archaeological clues to the first human-horse relationships. In my new book, Hoof Beats, I draw together ground-breaking scientific discoveries from the Eurasian steppes and across the ancient world, to tell a new story about how ancient people began using horses for both herding and riding, giving rise to new lifeways, cultures, and empires across the grasslands of Asia, Africa, and the Americas.

The author conducting fieldwork in northern Mongolia.

A modern *ovoo,* or ceremonial cairn, where horse heads
and hooves are adorned with prayer scarves in Mongolia.

A sunrise illuminates horse burials around monuments known as deer stones, built by Mongolia’s first horse herders in the second millennium BCE. — A sunrise illuminates horse burials around monuments
known as deer stones, built by Mongolia’s first horse
herders in the second millennium BCE.

This piece first appeared on the Unversity of California Press’s blog and is reprinted with permission.

William T. Taylor is an Assistant Professor and Curator of Archaeology at the University of Colorado Museum of Natural History in Boulder. He is the author of Hoof Beats: How Horses Shaped Human History

Businesses, unions clash on Draghi’s call to cut EU regulations

By Thomas Moller-Nielsen | Euractiv
Sep 9, 2024

Former European Central Bank President Mario Draghi talks to media in the Berlaymont, the EU Commission headquarters, on September 9, 2024 in Brussels, Belgium.. THIERRY MONASSE/GETTY

Euractiv is part of the Trust Project >>>

Mario Draghi’s call for EU policymakers to reduce companies’ regulatory burden to boost the bloc’s faltering competitiveness was praised by European business groups on Monday (9 September) but criticised by Europe’s largest trade union confederation.

The former European Central Bank president’s hotly anticipated report on the future of EU competitiveness repeatedly emphasises the “regulatory burden” European firms bear.

It also points to the “asymmetries in regulation” faced by EU firms relative to their peers in China or the US, which help create an “unlevel global playing field” for the bloc’s “otherwise productive companies”.

“The regulatory burden on European companies is high and continues to grow,” Draghi writes, adding that between 2019 and 2024, roughly 13,000 acts were passed by the EU compared to 3,500 pieces of legislation and 2,000 resolutions at the US’s federal level.

President of the influential lobby group BusinessEurope, Frederik Persson, praised Draghi’s “call for a frank and urgent discussion” on the EU economy’s challenges.

“We will pay close attention to the call for a renewed industrial strategy, which rightly prioritises measures like incentivising productive investments in Europe, lowering energy costs or reducing regulatory burdens on companies,” Persson said.

Wim Mijs, CEO of the European Banking Federation, similarly endorsed Draghi’s “strong supporting signals” for a “regulatory shift” in Europe’s banking sector as well as the Italian’s proposal to deepen Europe’s single market for capital to boost private investment.

“To support a strong economy, we need an internationally competitive banking system within the EU, as well as an assessment of the banking regulatory framework,” Mijs said.

Lack of productivity growth 'existential challenge' for Europe, Draghi report says
Europe is facing an “existential challenge” to increase its productivity, Mario Draghi’s long-awaited report on European competitiveness states, with the main priorities focused on advancing the tech sector and ensuring a successful transition towards climate neutrality.

Petri Salminen, President of SMEunited, representing small and medium-sized enterprises from over 30 European countries, said that Draghi “identifies correctly the problems Europe has with productivity and competitiveness”.

“The most important aspects for SMEs in this context are the reduction of regulatory and administrative burdens, a level playing field with big business, a better functioning single market and more reciprocity and fairness when it comes to relations with third countries,” Salminen said.

Jean François van Boxmeer, chair of the European Round Table for Industry, described Draghi’s “vision” for Europe as “potentially transformative”.

“In considering various dimensions of the EU’s current capacity to compete with its peers, [the report] succeeds in advancing an ambitious, informed vision of an EU rooted in better regulation, through more coherent operation that makes better use of existing tools,” he said.
‘The focus on deregulation must be rejected’

However, Esther Lynch, general secretary of the European Trade Union Confederation (ETUC), representing more than 45 million European workers, vehemently denounced the report’s emphasis on “deregulation”.

“The focus on deregulation included in the report must be rejected, including all attacks against ‘gold-plating’,” Lynch said, referring to member states’ practice of imposing additional regulations beyond those required by EU directives.

“We need a regulatory environment that protects workers and trade union rights,” she added.

Lynch’s criticisms echo those previously levelled by the ETUC at a previous report on the EU single market by another former Italian Prime Minister, Enrico Letta, which blamed “over-regulation” in the bloc for “inadvertently favour[ing] non-European companies that are not bound by the same stringent rules”.
Draghi attempts to ease workers’ concerns

Lynch, however, praised Draghi’s call for additional investments of up to €800 billion per year to finance the green and digital transitions, although she warned that such funds should “come with strings attached to ensure quality jobs and to ensure social progress”.

She also pointed to the “positive” fact that Draghi’s report “recognises that Europe should not try to compete on a race to the bottom on pay”.

Draghi himself went to great lengths to assuage workers’ concerns during his public presentation of the report on Monday.

“It’s natural that after 40 [or] 50 years of talking about competitiveness [people think it might translate into] lower salaries. Nothing of the sort is in this report,” he said.

“The reason is very simple: that’s not where competitiveness is actually playing. It’s not primarily [due to] labour costs”, he added.

Draghi instead stressed that Europe’s faltering competitiveness is predominantly a result of lagging productivity, which he attributed to the bloc’s insufficient digitalisation.

“As a matter of fact, in the European Union, productivity has been slightly better than it was in the United States if you take the high-tech sector out. So the answer cannot be labour costs, [labour market] flexibility, and all this. It has to be high-tech,” he said.

[Edited by Alice Taylor-Braçe]

Chinese firms condemn Draghi’s support for tariffs

By Thomas Moller-Nielsen | Euractiv
Sep 10, 2024

The China Chamber of Commerce to the EU (CCCEU) also pushed back against the Italian technocrat’s repeated condemnation of Chinese “overcapacity” and portrayal of Beijing as a “high-risk supplier” of critical minerals in his much-anticipated report on EU competitiveness, published on Monday. [Getty Images]
Euractiv is part of the Trust Project >>>

Chinese firms operating in the EU have criticised Mario Draghi’s suggestion that tariffs might be required to protect European industries from foreign competition, warning that such measures could escalate trade tensions between Brussels and Beijing.

The China Chamber of Commerce to the EU (CCCEU) also pushed back against the Italian technocrat’s repeated condemnation of Chinese “overcapacity” and portrayal of Beijing as a “high-risk supplier” of critical minerals in his much-anticipated report on EU competitiveness, published on Monday (9 September).

“Regarding the report’s proposal to apply tariffs or other trade measures, the CCCEU cautions against actions that could escalate trade tensions and disrupt the global green technology supply chain,” a spokesperson for the chamber, which represents over a thousand companies operating across the union, told Euractiv.

The spokesperson added that rather than pursuing “restrictive trade measures, ” Brussels and Beijing should adopt a “cooperative approach” to address climate change and promote sustainable development.

The CCCEU’s remarks come after Draghi, a former European Central Bank president, wrote that tariffs may be “warranted” in cases of “unfair competition from abroad.”

However, Draghi warned that such trade measures “should not be applied systematically” and that any attempt to emulate “the US approach of systematically shutting out Chinese technology” would only delay the EU’s efforts to green its economy.

Moreover, he emphasised that Chinese state-subsidised production of green technologies may have caused some European industries to fall “so far behind” that imposing tariffs “would only impose excessive deadweight costs on the economy.”

“The reference to China’s industrial overcapacity in green technologies overlooks the global demand for these products and the vital role China plays in driving global decarbonisation efforts,” the CCCEU spokesperson said.

“We are disappointed that this was viewed as a threat; we believe that China’s production capacity should be seen as an opportunity to meet the increasing global demand for clean energy technologies at competitive prices,” they added.

The spokesperson also noted that Draghi’s call for Brussels to step up its efforts to diversify its supply of minerals critical for the green transition away from China was similarly misconstrued.

“Labelling China as high-risk without acknowledging the benefits of partnership could undermine opportunities for joint efforts to secure reliable and diversified supply chains,” they said.

Draghi’s report comes amid soaring trade frictions between Brussels and Beijing.

Last month, Beijing announced an anti-dumping probe into EU dairy imports – the day after the EU confirmed provisional duties of up to 36.3% on China-made electric vehicles.

The trade dispute also comes amid broader geopolitical tensions over China’s increasingly close ties with Russia and the political status of Taiwan, a de facto autonomous island that Beijing claims as part of its territory.

[Edited by Martina Monti/Alice Taylor-Braçe]

LA REVUE GAUCHE - Left Comment