CAP: Import Tariffs On China-Subsidized Panels Help Level The Solar Playing Field

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"CAP: Import Tariffs On China-Subsidized Panels Help Level The Solar Playing Field"

Today the U.S. Department of Commerce announced plans to impose import tariffs ranging from 2.9 percent to 4.73 percent on Chinese-manufactured solar panels. Melanie Hart, China Energy and Climate Policy Analyst at the Center for American Progress, issued the following statement:

Today’s Commerce Department decision to levy import tariffs on Chinese solar panels is a positive step forward in a much larger effort to level the clean energy playing field between the United States and China. I applaud SolarWorld for pursuing this case and utilizing the trade institutions designed to address these types of complaints. Too many U.S. companies avoid filing trade petitions because they fear Chinese government retaliation. When U.S. companies allow those fears to prevail, the end result is tacit accommodation to illegal trade behavior, and that can erode U.S. competitiveness and drive entire U.S. industries out of business.

This countervailing duty (subsidy) tariff is lower than many industry analysts expected. It is important to note, however, that in trade cases where subsidy and dumping petitions are filed in tandem, the dumping tariff is generally the higher import duty. The Commerce Department is expected to issue the SolarWorld dumping determination in May. At this point it is far from clear what the end result of this case will be and how it will impact manufacturers in the United States and China.

One thing that we can say based on this relatively low subsidies tariff is that the Commerce Department did not apply punitive duties in this ruling. Instead, the Commerce Department based this decision on its own review of the evidence and only levied tariffs based on what it could prove. Chinese companies and officials are watching this case very closely, and hopefully this action will serve as an example in China for how these cases can and should be handled impartially and according to law.

The United States and China are the world’s biggest energy consumers. Keeping our borders open to allow and encourage clean energy trade can stimulate competition, speed innovation, and bring down costs to speed our transition toward a clean energy economy. To be equally beneficial for both countries, however, it is critical that U.S. and Chinese companies compete on a level playing field. At present, it is clear that the field is often far from level. Allowing and encouraging U.S. companies to file trade petitions such as this one is critical for correcting that imbalance.

These tariffs are designed to counteract government subsidies in China that artificially suppress Chinese manufacturing costs and give Chinese solar panels a pricing advantage in the U.S. market. Today’s announcement is the first of two long-awaited tariff verdicts on two trade petitions filed last October by SolarWorld Industries America Inc. A Commerce Department decision on the second trade petition (dumping) is expected in May, and the May ruling could substantially increase the cumulative import tariffs levied on Chinese solar panels in the United States.

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