The ongoing investigation on import duties on Chinese solar products is entering a critical phase. Hundreds of companies, associations and environmental organisations from all EU member states are calling for an end to those measures.
The European Council met to discuss its future trade policy towards China, among other topics. Also this past week, representatives of the European Commission together with representatives of China have talked about trade issues. Both sides agree that further trade barriers either in China or the EU are not welcome for either region. “We do welcome that high level representatives from both China and the EU have the same opinion in this matter”, comments Dr. Holger Krawinkel, spokesperson of the Solar Alliance for Euroe (SAFE). He continues: “It would be better even if this agreement applied to existing trade barriers.”
The ongoing investigation on import duties on Chinese solar products such as modules and cells is entering its critical phase. The European Commission is likely to publish their preliminary findings before the end of this year and commence dialogue with member states. “Recent development has shown that our line of argument is supported widely. An overwhelming majority of companies from the European solar sector has called for an end to the duties and minimum import price (MIP)”, Krawinkel points out. “36 national associations and organisations as well as 400 companies from all 28 member states have made that clear in an open letter to the Commission.”
It is remarkable that large environmental organisations such as Greenpeace and the WWF have made the same point. “We all agree that duties and the MIP have done damage to the European solar sector, put unnecessary financial strain on consumers and thwarted the achievement of European and global climate goals.”
Krawinkel adds: „Furthermore, the measures are reduced to absurdity. Almost all globally leading Chinese module manufacturers have left the MIP undertaking. Among the Top 10 of the world’s largest manufacturers, only two are still bound by this undertaking; among the Top 20 it is only five.” The numbers: 15 out of the Top 20 global leaders are Chinese. They represent approx. 60 GW of global module manufacturing capacity. More or less one quarter of this capacity is bound by the MIP undertaking.
What is the reason? Leading manufacturers have built capacity outside China but are able to produce cost efficiently nonetheless. In the EU, these products can be sold well below the MIP which is at 56 € cent/kW. Krawinkel explains, “This price effect is not caused by dumping. The IHS report published earlier this year, compared manufacturing cost globally. The report explains that Chinese companies are market leaders for reasons such as scale and a level of standardization.”
The SAFE spokesperson adds that in the meantime an increasing number of European manufacturers is able to sell modules below MIP. “This is a positive development. These manufacturers have obviously done their homework and have reached a competitive price level. It follows that it would be best to stop the solar trade barriers altogether. A positive side effect for European manufacturers would be being able to purchase manufacturing components at a lower price on the world market and keep up with competitors”, Krawinkel concludes.