Case 12: EV Trade War USA and EU V. China Flashcards
Why are the U.S. and E.U. raising tariffs on Chinese electric vehicles (EVs) and clean energy components?
They believe Chinese government subsidies give them an unfair advantage.
The U.S. and E.U. are raising tariffs on Chinese _______________________ and clean energy components.
(electric vehicles)
What do advocates of these tariffs argue is the primary benefit?
They maintain that tariffs are necessary to protect domestic industries and jobs.
Opponents of the tariffs predict that they will slow down the world’s transition to _______________________ by driving up EV costs.
(clean energy)
What is the core question at the heart of this issue?
How should governments balance fair competition in international trade with the global necessity of affordable clean energy technologies?
STANCE: Governments can strike a balance between protecting domestic industries and ensuring affordable clean energy by adopting a strategy that integrates moderate _______________________ , __________ subsidies, and ___________.
- tariffs
- domestic production
- direct consumer incentives
What is the ultimate goal of governments in addressing this issue?
To combat _______________________ by ensuring the affordability and accessibility of clean energy technologies.
(climate change)
What was the outcome of the Investment Tax Credit (ITC) program for the solar energy industry?
68% drop in solar energy system costs and 1,600% increase in installations (2010-2019).
What was the result of India’s FAME II subsidy program for EVs?
70% year-over-year increase in EV registrations.
What do these examples (ITC and India’s FAME II) demonstrate about subsidies?
Subsidies can increase local industry competitiveness and consumer uptake without relying solely on protectionist tariffs.
What is the subsidy amount per EV under the Inflation Reduction Act in the U.S.?
Up to $7,500.
What was the outcome of EV subsidies in Norway?
79% of new car sales were electric in 2022.
How can subsidies help local producers compete effectively?
When combined with moderate tariffs.
