German Chancellor Angela Merkel has called for a frank assessment of a
solar panel trade dispute with China. The EU is mulling an anti-dumping inquiry
into China after the US took similar action in one of the world’s
fastest-developing markets.
“I suggest the European
Commission and China try to solve the issue through communications, rather than
by resorting to anti-dumping proceedings,” Merkel told reporters Thursday
morning during her two-day trip to China. “There is still time, so the best way
is consultation,” she said.
Merkel struck a different tone on
Friday, however: “We are not out of the woods yet. … My plea is that everyone
be transparent, that they lay their cards on the table about how they produce.”
Tensions between China and
Germany are on the rise over Chinese solar panel exports to Europe. German
solar panel manufacturer SolarWorld is leading a charge of about 25 European
companies to press anti-dumping charges against China. They have taken their
complaint to the European Commission, which has until next Friday to decide
whether to open an investigation into allegations that China is intentionally selling
panels at below fair market value.
Solar panels have become an
increasingly popular source of renewable alternative energy internationally,
with Germany leading the market. After the Fukushima disaster, Germany
introduced an initiative to end the use of nuclear energy by 2022. The nation
set a world record in May, producing 22 gigawatts of solar energy – the
equivalent of 20 nuclear plants, and over half the country’s energy quota.
Europe is currently the world’s
biggest solar market, accounting for 60 percent of China’s solar exports,
valued at $35.8 billion according to data issued by China’s major solar
manufacturers.
Competition from China has forced
European manufacturers to halve prices on solar panels, pushing several
companies into bankruptcy.
Dark Days Ahead For Chinese Solar?
The US has already taken similar
measures to the proposed European Commission inquiry, imposing anti-dumping
tariffs on Chinese solar panels ranging from 31 to 35 percent. The tax hike
followed a May ruling by the US Department of Commerce that China was
deliberately selling its panels below market cost.
The ruling came after the
bankruptcy of two major US solar panel manufacturers, Solyndra and Abound
Solar, who both cited competition from China for their closures.
Chinese manufacturers have been
hit hard by the US tariffs, resulting in widespread layoffs and skyrocketing
supplies, which has further driven down domestic prices. The companies have
called on the Chinese government to respond if the European Commission acts on
the complaint.
“We call on the Chinese
government to take all necessary and resolute measures to protect the
legitimate interests of the Chinese solar industry,” Yingli Solar CEO Wang Yiyu
said at a briefing from the four major Chinese solar firms – Yingli, SunTech,
Trina and Canadian Solar.
“If the EU were to follow the
precedent of the US and launch an anti-dumping investigation into Chinese solar
products, the Chinese solar industry would suffer a fatal blow,” Yiyu said.
“The investigation would also
trigger a trade war between China and the EU, which would cause huge losses to
both parties.”
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