Marco Fernandes, a research fellow at the Tricontinental Institute for Social Research in Brazil, has called for more innovations and the production of electric vehicles to advance Chinese technology.

Mr Fernandes made this submission on Tuesday at an international symposium organised by the Chongyang Institute for Financial Studies at Renmin University of China.

“One of the things I have been reading and following recently is that European countries and the U.S. are afraid of competition with Chinese EVs because they are better and cheaper,” said the research fellow. “The buzzword now is overcapacity.”

He said China was accused of overproducing some goods, mainly new EVs and renewable energy equipment, and facing low domestic demand. Mr Fernandes said it was also alleged that China used this approach to seek more foreign markets for its products at low prices.

“Is it true the prices of Chinese EVs are only low because the state subsidises these companies, harming the market mechanism to beat the competition in global market?

“This accusation is based on half-truths; yes, the Chinese state subsidises many of its companies; so do the U.S., Europe and many other countries around the world.

“It is part of the game of global competition; also innovation and high-productivity helps to lower prices of Chinese products,’’ Mr Fernandes explained.

The research fellow said with high-quality craftsmanship, innovative designs, and competitive pricing, companies like BYD, NIO, Xpeng, Hongqi, and Lynk and Co were winning patronage in many countries.

He added, “Today, China’s auto exports have surged, reaching record high of 4.91 million vehicles in 2023, as the country’s automakers expanded their presence overseas.

“The massive growth was propelled by a surge in the exports of New Energy Vehicles (NEV), which soared 77.6 per cent to more than 1.2 million units in the past year.

“The China Association of Automobile Manufacturers (CAAM) predicts China’s NEV sales will reach 11.5 million in 2024, while total auto exports are expected to hit 5.5 million units. While the collective West deems China’s ‘overcapacity’ a threat, it can be an opportunity for the Global South.’’

He revealed that after substantial Chinese investments in infrastructure through BRI, recent developments indicated a higher level of cooperation between China and developing countries, saying Mexico and Brazil also received Chinese NEV factories.

“Numerous partnerships between Chinese state-owned and private companies with Global South countries have been established and most are related to local processing of high-demand minerals or production of electric vehicles.

“There are high expectations that regional initiatives like the BRI, expanded BRICS-10, and Shanghai Cooperation Organisation can leverage to strengthen this process, even though they face opposition from Western powers.

“We need to deepen this kind of cooperation,” Mr Fernandes said. 

(NAN)