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Suntech gets $32 mln emergency loan from local government

(China Daily)

10:50, October 01, 2012

BEIJING, Sept. 29 (Xinhuanet) -- China's Suntech Power Holdings Co Ltd, the world's largest solar panel maker by capacity, has been granted an emergency funding package worth 200 million yuan ($31.7 million) from the government of Wuxi city in East China's Jiangsu province.

The company has the largest photovoltaic solar panel production base in China, and the local government there has already carried out a series of measures, including granting subsidies and loans, to help solar companies in the area.

Zhu Kejiang, the mayor of the city, went to Suntech with a finance offer from a consortium of several banks, including Bank of China, on Thursday, aimed at helping it weather its financial difficulties.

According to reports from China Business News on Friday, the company still has about 1 billion-yuan worth of debt to pay back by the end of the year. In the first quarter of this year, its debts totaled $1.79 billion.

The consortium has helped by granting short-time loans, which will ease its ongoing costs.

The move comes as China's photovoltaic industry has seen huge challenges this year, as the US and EU - China's two main export markets - both launched anti-dumping probes into the country's solar exports.

Suntech has already reduced its production plan for the fourth quarter. A week ago, the company announced 1,500 job cuts.

According to Suntech officials, its exports in the third quarter reached 450 megawatts (mW), and it has another 450 mW of overseas orders due in the fourth quarter. Its annual production will be about 1.9 to 2 gigawatts.

However, its financial situation is worrying investors.

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