The Ministry of Commerce said on Sept 18 that the European Union's recent decisions regarding tariffs on Chinese solar panels were a positive step toward market normalization, and it hopes the EU will completely scrap such measures.

Two days earlier, the EU issued its final announcement that it will limit China's solar panel exports by setting a minimum import price. The regulation will take effect Oct 1, and the minimum import price will be set step-by-step.

Specifically, the European Commission set the minimum import price for different photovoltaic products. The price for polycrystalline cells is 0.19 euros ($0.23; 17p) per watt, while the price for monocrystalline cells is 0.23 euros per watt, and the polycrystalline and monocrystalline components will be, respectively, 0.37 euros per watt and 0.42 euro per watt.

The EU first imposed tariffs on Chinese solar products - which make up one-third of sales in the EU - in 2013. They were allegedly retailing at below production cost. It extended the trade measures to the end of 2015.

However, appeals for fewer restrictions among member countries have been on the rise in Europe, with hundreds of companies and environmental organizations asking the commission to scrap the measures.

Industry insiders say the development of clean energy in Europe has been impeded because of the tariffs and the setting of a minimum import price, and called for the commission to scrap the anti-dumping duties.

China's Commerce Ministry, which has repeatedly urged the EU to suspend trade measures against the country's solar exports, said last month that the European Commission must immediately withdraw wrongly imposed penalties on China's photovoltaic sector.

"The EU should fulfill its commitment to the World Trade Organization and abandon the surrogate country system in its trade measures regarding China," said Zhou Mi, a senior research fellow at the Chinese Academy of International Trade and Economic Cooperation.

He said the new regulation still lacks transparency in the way price standards are determined.

"This will result in an unfair business environment for Chinese enterprises, and it won't benefit EU members in implementing their climate agreement commitments."

He added: "Limiting the import price by unit capacity will intensify trade competition between PV makers in China. Businesses will strive to improve their product efficiency, and lowering the threshold of the import price gradually relieves the companies' financial burden."

Zhou Dadi, a senior researcher for the China Energy Research Society, says the cost of manufacturing PV products is now relatively low, and China has an abundant supply of such products.

"Ever since last year, the EU has been offering subsidies to some countries for their PV products, which together with the new measure will affect exports of China's PV products to some extent," Zhou said.

"However, the influence won't be that much. Ten years ago, 90 percent of China's PV products were exported. Now, exports mean much less for the sector, in that it is more dependent on the domestic market. Therefore, the regulation will not affect Chinese PV manufacturers to a great extent."

Contact the writers at zhengxin@chinadaily.com.cn

(China Daily Africa Weekly 09/22/2017 page25)