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Purveyor

(29,876 posts)
Tue May 29, 2012, 11:59 AM May 2012

Trade War Looming as China Rebukes U.S. Support for Solar

China’s allegation that renewable- energy subsidies in five U.S. states violate free-trade rules ratchets up a potentially costly trade war between the world’s two largest economies.

“It’s a long, slow escalation of trade and currency wars as we race to the bottom,” said Theodore O’Neill, an analyst with Wunderlich Securities Inc. of New York.

Programs supporting renewable power, including wind and solar, in Washington state, New Jersey, Massachusetts, Ohio and California, violate World Trade Organization policies and trade treaties, according to a preliminary finding of an investigation posted yesterday on the website of China’s Ministry of Commerce. China filed a complaint today at the WTO over U.S. procedures for calculating anti-subsidy duties on imports.

Those announcements followed a preliminary decision by the U.S. Commerce Department last week to impose tariffs of as much as 250 percent on imports of Chinese solar cells. The agency said the units were being sold for less than the cost of production in an attempt to drive out domestic competition.

MORE...

http://www.bloomberg.com/news/2012-05-24/trade-war-seen-looming-as-china-rebukes-u-s-support-for-solar.html

9 replies = new reply since forum marked as read
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Trade War Looming as China Rebukes U.S. Support for Solar (Original Post) Purveyor May 2012 OP
The issue with renewables is, to my mind, akin to Nuclear Unicorn May 2012 #1
China is dumping solar cells below cost. Lasher May 2012 #3
No dispute here. That's what is pushing the trade war. Nuclear Unicorn May 2012 #5
Costs are currently low - artificially so. Lasher May 2012 #6
Again, no dispute here. I'm in agreement with every tittle and jot. Nuclear Unicorn May 2012 #7
Aren't they trying to buy rare earth mineral rights outside China? Lasher May 2012 #8
It would be like the Arab oil embargo. Zalatix May 2012 #9
War, shmar-- they're dumping solar panels, we're... TreasonousBastard May 2012 #2
China STARTED the trade war with their own solar subsidies. WTF. Zalatix May 2012 #4

Nuclear Unicorn

(19,497 posts)
1. The issue with renewables is, to my mind, akin to
Tue May 29, 2012, 12:06 PM
May 2012

when computers were first coming on line. At first computers were huge -- impractically so -- and prohibitively expensive. But as they entered the mainstream economy of scale took over. Now computers can be had with greater value at equal or lesser value making them accessible.

A trade war at the point when renewables are about to go mainstream would be crippling. To drive up the cost would be to keep them out of the reach of the ordinary household. Without that economy of scale investments could be exhausted setting them back by decades.

This is horrible.

Lasher

(27,597 posts)
3. China is dumping solar cells below cost.
Tue May 29, 2012, 01:03 PM
May 2012

They are also creating excess supply to further drive down prices artificially worldwide. They are trying to drive our domestic manufacturers out of business. We are reacting appropriately by levying import tariffs.

Nuclear Unicorn

(19,497 posts)
5. No dispute here. That's what is pushing the trade war.
Tue May 29, 2012, 05:05 PM
May 2012

But until it resolves the costs will be high and stunt broader market reach.

Lasher

(27,597 posts)
6. Costs are currently low - artificially so.
Tue May 29, 2012, 05:42 PM
May 2012

China is not going to stop employing these predatory trade practices. Don't get me started on currency manipulation. We have been doing a pretty poor job of protecting our domestic manufacturing in general.

If we take no measures to thwart them, and if both Europe and India are to be equally complacent, the most logical outcome is a Chinese monopoly. They do not want to bankrupt competitors so that they can subsequently lower prices. They want to control the market so that they can raise prices with impunity. And with no real competition, they would not have an incentive to spend a lot of money to develop better products.



Nuclear Unicorn

(19,497 posts)
7. Again, no dispute here. I'm in agreement with every tittle and jot.
Tue May 29, 2012, 06:15 PM
May 2012

Since you're obviously engaged on this issue: What do you think the chances are of China strangling the Rare Earths market in retaliation? I've read they're the #1 source for the materials needed in many green tech items as well as consumer electronics. That seems like they have us at a disadvantage.

Lasher

(27,597 posts)
8. Aren't they trying to buy rare earth mineral rights outside China?
Tue May 29, 2012, 06:37 PM
May 2012

Seems I remember reading that they were trying to gain control of deposits in Australia. And of course you must be aware of these minerals that they have inside their own country.

Yep, that's another concern we share.

 

Zalatix

(8,994 posts)
9. It would be like the Arab oil embargo.
Tue May 29, 2012, 10:10 PM
May 2012

We're too dependent upon exports. We're asking for such things to happen to us.

TreasonousBastard

(43,049 posts)
2. War, shmar-- they're dumping solar panels, we're...
Tue May 29, 2012, 12:31 PM
May 2012

hitting them with a tariff, they're making threats...

It's just business as usual-- China isn't about to start a real trade war with their biggest customer who happens to owe them trillions.

 

Zalatix

(8,994 posts)
4. China STARTED the trade war with their own solar subsidies. WTF.
Tue May 29, 2012, 01:04 PM
May 2012

Why do we keep letting the free traitors frame the argument and absolutely distort reality all in their favor?

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