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China warns of retaliation if EU imposes import duties

This week, China warned the EU that imposing import tariffs on Chinese PV products could incur counter-tariffs from China.

Chong Quan, China's deputy international trade representative. Credit: Chinese Ministry of Commerce

Chong Quan, China’s deputy international trade representative. Credit: Chinese Ministry of Commerce

“If the EU insists on imposing duty orders on Chinese exports and severely hurts the interests of Chinese manufacturers, the Chinese government will not stand by,” Chong Quan, deputy international trade representative with the Chinese Ministry of Commerce, told China Daily.

“We have no choice but take any measure to protect the lawful rights of Chinese businesses.”

“Once again, we call on the EU to seriously consider China’s suggestions as well as the appeal from enterprises from the EU’s upstream and downstream solar industry to cautiously use trade remedy measures. We hope the dispute can be resolved through negotiations,” Chong said.

China has been hit hard by American import duties and a global PV industry oversupply, with a 35 percent decrease in exports of solar products in 2012.

Late last year, the EU began its own investigation into Chinese PV products amid claims that Chinese PV panel producers have been selling products at below cost price and benefitting from unfair Chinese government subsidies, giving them an unfair advantage over PV panel makers in the EU.

The EU has taken the case to the World Trade Organisation and the two parties are currently in talks to resolve the dispute. The EU has until June to make a preliminary decision on whether to impose import tariffs on Chinese PV goods.

According to the Ministry of Commerce, such tariffs could impact 400,000 Chinese workers and will have a negative impact on the China-EU trade relationship.

China is a major trading partner with the EU, and imports some components for PV panels from the EU, so retaliatory measures could have negative impacts on EU solar panel makers.

According to a report commissioned by the EU-based  Alliance for Affordable Solar Energy (AFASE), imposing tariffs on Chinese PV imports would increase the cost of solar products in the EU and thus decrease demand.

The report predicts that up to 240,000 European jobs could be lost if such measures are implemented.

“The potential positive impact of duties for the EU solar producers is dwarfed by the negative impact on employment in the EU,” says AFASE spokesperson Thorsten Preugschas. “[T]he jobs created by the EU solar producers represent at the very most 20% of the jobs lost along the PV value chain.”


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