Commentary: It is unwise for EU to launch solar trade war against China
- wuliming
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E-mail Xinhua, September 6, 2012
by Wu Liming
BEIJING, Sept. 6 (Xinhua) -- Waging a trade war based on the alleged dumping of Chinese solar products is unwise for the European Union (EU) because such a move will only backfire and hurt not only Chinese producers but Europe itself.
The EU is again wielding its anti-dumping weapons against China in their latest trade dispute as the European Commission on Thursday launched an investigation into suspected dumping of solar panels by Chinese producers.
First, such a move, the largest anti-dumping claim ever filed by the EU, will hurt the economic bloc's own solar energy companies.
It is true that European solar panel producers may benefit from the EU's imposition of anti-dumping tariffs on Chinese products. But European solar energy equipment producers and raw material manufacturers will suffer.
In recent years, Chinese solar panel manufacturers have imported raw materials and equipment worth more than 10 billion U.S. dollars from Europe, especially from Germany.
Therefore, if Chinese solar panel factories collapse after losing the European market, European suppliers for solar panel equipment and raw materials would have an even worse time, even job cuts.
Second, tariffs would deal a big blow to European solar panel consumers, including farmers in the Alps. Over the past decade, the use of solar energy has become a trend in Europe, now the world's largest solar panel market.
Apart from immense urban demand for solar panels, more and more farmers living in the valleys of the Alps Mountain have solar panels installed on their roofs.
Hence, European consumers would have to pay much higher prices for solar products if the EU decided to keep China's low-price solar panels out of its markets.
Third, implementing protectionist measures would only bring negative effects to the EU's energy security and strategy.
It is known to all that the EU's energy imports account for half of its energy consumption. The EU relies heavily on oil from the Middle East and gas from Russia, but repeated cuts in Russia's gas supply has made Europe suffer.
To safeguard its energy security, the EU has striven for an ambitious energy strategy by promising to increase its percentage of renewable energy to 20 percent by 2020.
The core of the 2020 energy strategy is to develop solar energy. But without China's inexpensive, high-quality solar products, the strategy would be difficult to advance because the EU would have to pay higher prices for the same products.
In short, the EU's decision to check China's solar products via protectionist measures is short-sighted and the bloc would become its own victim.
According to European media reports, some EU solar companies said Europe should welcome Chinese imports because they make solar power more affordable.
The companies' alliance, the Association for Applied Solar Energy, called on the EU to uphold free trade to secure jobs and support industry growth.
All in all, Europe should be cautious on waging a trade war against China on solar products. Enditem
