U.S. Imposes Steep Tariffs on Chinese Solar Panels

Source: New York Times

The Commerce Department began closing a chapter in a protracted trade conflict with China over solar equipment Tuesday, approving a collection of steep tariffs on imports from China and Taiwan.

The decision, intended to close a loophole that had allowed Chinese manufacturers to avoid tariffs imposed in an earlier ruling by using cells — a major module component — made in Taiwan, found that the companies were selling products below the cost of manufacture and that the Chinese companies were benefiting from unfair subsidies from their government.

The department announced anti-dumping duties of 26.71 percent to 78.42 percent on imports of most solar panels made in China, and rates of 11.45 percent to 27.55 percent on imports of solar cells made in Taiwan. In addition, the department announced anti-subsidy duties of 27.64 percent to 49.79 percent for Chinese modules.

“These remedies come just in time to enable the domestic industry to return to conditions of fair trade,” said Mukesh Dulani, president of SolarWorld Americas. “The tariffs and scope set the stage for companies to create new jobs and build or expand factories on U.S. soil.”

Read more: http://www.nytimes.com/2014/12/17/business/energy-environment/-us-imposes-steep-tariffs-on-chinese-solar-panels.html

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...what will be the pillars of the Obama administration’s economic policy toward China?

Romney lost, and it was Romney supporters who were most supportive of the next president confronting China. Nearly two-thirds of Republicans backed getting tougher with Beijing, up 11 percentage points in just a year. Democrats, on the other hand, prioritized building stronger economic relations with China (53%) over getting tougher with China (39%). Democrats’ backing for confrontation was up 6 points since 2011, but it remained the minority sentiment among those in Obama’s party.

Likely components of the administration's economic policy towards China

The first will likely be more complaints about Chinese subsidies and trade practices filed with the WTO, given the president’s campaign promises and his record during his first term. Washington has been relatively successful with such cases in the past, and pursuing multilateral dispute settlements has the added advantage of avoiding a direct bilateral confrontation with China.

The second will be the pursuit of trade agreements that notably do not include China. The most important of these is the Trans-Pacific Partnership (TPP), a free trade agreement among a growing list of nations bordering the Pacific. It is the Obama administration’s avowed aim to construct a TPP with standards so high — especially rules regarding behavior by state-owned enterprises — that China could never join without transforming its economic system. This stance in part reflects the fact that two-thirds (67%) of the U.S. public believe China practices unfair trade, according to a 2012 survey by the Chicago Council on Global Affairs.

The likely 2013 launch of a U.S.-European Union free trade negotiation — effectively a Trans-Atlantic Partnership, a bookend for the TPP — primarily reflects majority (58%) sentiment in the United States that increased trade with Europe would be a good thing for the United States. But it can also be seen as an attempt to establish U.S.-European, rather than Chinese, technical and regulatory standards as global business norms.

http://www.pewglobal.org/2012/12/10/u-s-china-economic-relations-in-the-wake-of-the-u-s-election/