EU calls on China for reciprocal market access as cheap Chinese products flood the bloc

The EU is ready to face China head-on over cheap imports: President of the European Commission Ursula von der Leyen called on China to work towards a more balanced trade relationship with the European Union during her meeting with Chinese President Xi Jinping in Paris yesterday. Von der Leyen warned that “Europe will not waver from making tough decisions needed to protect its economy and security,” while China is restricting the bloc’s access to its markets and flooding Europe with heavily-subsidized Chinese products, according to a European Commision statement.

But China argues that a clampdown on its imports would harm the global green transition: China’s cheaper green technologies are necessary to further the energy transition, Xi Jinping’s Special Envoy for Climate Change Liu Zhenmin told Bloomberg on Thursday. Backlash from the US and EU would result in a “delay in the substitution of fossil fuels by renewables globally,” Liu said, adding that energy transition costs would increase by up to USD 6 tn — equating to a 20% jump — without cheaper Chinese products and technology.

Remember: Tensions over green technology have been brewing for a while between China and the West over the oversupply of cheap solar panels and EVs from China, which has crowded US and European markets and threatened domestic production. The European Commission launched an investigation in September to consider imposing punitive tariffs on Chinese EV imports as a protection measure for local producers.

THE MARKETS THIS MORNING-

Asian markets are in the green this morning as traders in Korea and Japan returned from a long weekend. The sole exception is the Hang Seng. US stock futures were largely unchanged in overnight trading, while European futures are doing a bit better, pointing to a comfortable start to the trading day.

THE CLOSING BELL-

The ADX closed flat yesterday on turnover of AED 1.1 bn. The index is down 5.7% YTD.

In the green: Eshraq Investments (+5.1%), Palms Sports (+3.6%) and Al Seer Marine Supplies and Equipment (+3.3%).

In the red: GFH Financial Group (-5.4%), Gulf Medical Projects (-4.0%) and Gulf Cement (-3.8%).

Over on the DFM, the index rose 0.3% on turnover of AED 215.2 mn. Meanwhile Nasdaq Dubai closed up 0.4%.

CORPORATE ACTIONS-

#1- Agility subsidiary Agility Global approved a dividend payout of USD 130 mn for 2024, according to an ADX disclosure (pdf). The Kuwaiti logistics outfit Agility subsidiary will distribute USD 65 mn in 1H 2024, one month after listing on the ADX, with the remaining USD 65 mn paid out in the second half of the year.

ICYMI- The Kuwaiti logistics outfit’s operations and asset management subsidiary received approval from the Abu Dhabi Securities Exchange (ADX) to move forward with a technical listing on the Abu Dhabi bourse last week. Shares closed up 327% on their trading debut on the ADX.

#2- Al Yah Satellite Communications Company’s board approved an interim dividend distribution of AED 200.8 mn, according to an ADX disclosure (pdf). This brings the total dividend for the year to AED 401.6 mn.

#3- Real estate firm Manazel has tapped investment banking firm Houlihan Lokey to act as its financial advisor on its capital optimization plan, the developer said in an ADX disclosure (pdf).