Measures on the part of United States authorities to impose steep import duties on dumped solar panels from China are sensible, an American industry lobby claims.
The Alliance for American Manufacturing (AAM) has applauded a recent decision by the US Commerce Department to impose import duties of roughly 31 per cent on Chinese-made solar cells, saying that the move represents a sound response to the overproduction and dumping of product into the US market.
“The burgeoning solar panel industry is important to US manufacturing, and deserves federal support in the face of China’s mercantilism,” the AAM says in a statement.
The decision to impose the duties followed moves on the part of several US manufacturers to file dumping charges against Chinese firms to offset alleged illegal Chinese government subsidies. It also follows previous moves by the United Steelworkers (USW) to file a section 301 trade case against China for alleged dumping and subsidies in the clean energy sector as well as moves on the part of 59 Senators and Members of Congress to urge President Barack Obama to investigate allegations of Chinese firms dumping subsidised solar panels in the US at below fair market value.
The core of the problem, says Usha Haley, professor of international business at Massey University in New Zealand and Research Associate at the Economic Policy Institute in Washington DC, lies in China’s ‘manufacture at all costs’ approach. Capacity at Chinese solar manufacturing plants, Haley says, represents a whopping 32 times domestic consumption, meaning that Chinese manufacturers are forced to export 95 per cent of their production into offshore markets.
The AAM says unfair competition from China is hurting both US workers and manufacturers in an important growth sector for the country’s economy. In recent times, no fewer than 12 American producers have either shut down production completely or undergone significant layoffs, the organisation says.
Despite China’s complaints about the decision being unfair, the AAM believes this is unlikely to result in retaliatory action because the Chinese government understands America’s importance to the Chinese economy.