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China should hit back at US ruling on solar cells

By Zhou Xiaoyuan (People's Daily Overseas Edition)

16:55, May 23, 2012

Edited and translated by People's Daily Online

The U.S. Commerce Department issued a preliminary ruling on May 17 to impose anti-dumping duties of up to 250 percent on solar cells and modules imported from China, the highest punitive tariffs ever imposed on Chinese solar companies.

China should respond forcefully and make every effort to let the United States withdraw the unfair and harsh ruling, so as to avoid a trade war between the two countries in the solar power sector, said Li Junfeng, deputy director of the Energy Research Institute under the National Development and Reform Commission.

The development of China’s solar industry relies heavily on exports, and the production costs of China’s solar products are only less than 30 percent lower than those of their U.S. counterparts. A 30 percent tariff would be enough to drive Chinese solar companies out of the U.S. market and cause serious damage to these U.S.-oriented exporters, said Huo Jian’guo, president of the Chinese Academy of International Trade and Economic Cooperation (CAITEC) under the Ministry of Commerce.

“Punitive tariffs of more than 20 percent would make the United States an almost unprofitable market for Chinese solar companies, not to mention a 100 percent tariff,” Li said, adding that the imposition of both anti-dumping and countervailing duties would block Chinese companies’ access to the U.S. market.

Analysts noted that the ruling was unreasonable mainly because the United States chose a surrogate country that is incapable of manufacturing solar products on a large scale, and used production costs in the country as a basis for determining whether Chinese companies were dumping their goods.

Mei Xinyu, a researcher at the CAITEC, said that the U.S. ruling was a result of using the standards of inefficient manufacturers to restrict efficient ones. Such move is intended to reduce Chinese companies’ share of the U.S. solar market, and even to drive out all Chinese companies, in order to save inefficient U.S. manufacturers.

Taking advantage of protectionism to prevent Chinese products from entering the U.S. market may be the last hope for U.S. solar companies, which are unable to and do not expect to compete with Chinese companies in other markets, Mei said.

Huo believes that the United States has decided to impose high tariffs on Chinese companies mainly for the political purpose of containing China, but not for the purpose of promoting international trade and economic cooperation as it claimed.

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Dreampursuer at 2012-05-2461.175.218.*
American enterprise also have large investment in china , American products also need to enter chinese market to amplify their sales , why not adapt any measures manage them ? why China always is the victim ?

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