EU, China strike interim trade deal that could cut Chinese hybrid exports, EU envoy says

In a significant step to ease rising tensions, the European Union and China have reached an interim trade agreement, according to the EU trade commissioner, Maros Sefcovic. The deal, reached after two days of negotiations, aims to address concerns over trade imbalances and China's massive trade surplus, which reached 360 billion euros ($410 billion) in the previous year.

While the specifics of the preliminary agreement remain undisclosed, the EU commissioner revealed that it includes lower tariffs for certain European goods heading to China and measures to stabilize the supply chains of rare earth minerals.

The trade agreement could potentially cut up to 50 percent of Chinese electric and plug-in hybrid vehicle imports to the EU, significantly impacting Chinese exports to the European market. Sefcovic emphasized that the deal, subject to approval by leaders across the 27-nation EU, would also lower tariffs on products benefiting "almost every" EU nation. Furthermore, the agreement is expected to prevent several million Chinese car exports to the EU, as reported by the Chinese Commerce Ministry.

Chinese Commerce Minister Wang Wentao expressed concerns over the interim deal, but the EU commissioner assured that the agreement represents a crucial step towards resolving key factors behind the trade deficit. As the two sides continue to work towards a more balanced trade relationship, this interim agreement marks a positive development in efforts to prevent further escalation of trade tensions between the EU and China.