Sino-US trade dispute: Low tariffs to be imposed

The preliminary decision determined by the Department of Commerce to impose low tariffs on imported solar cells and modules is a relatively positive outcome for the U.S. solar industry and its 100,000 employees, says Jigar Shah, President of the Coalition for Affordable Solar Energy (CASE).

The countervailing tariffs are said to range from 2.9 to 4.37 percent and express what the Department of Commerce deems as ‘unfair subsidies’ that the PV companies have received from the Chinese government.

4.73 percent tariffs will be applied to U.S. imports from Trina Solar, 2.9 percent from Suntech, and 3.6 percent from all other remaining Chinese manufacturers.

Reacting to the decision Shah said: "Tariffs large or small will hurt American jobs and prolong our world’s reliance on fossil fuels. Fortunately, this decision will not significantly raise solar prices in the United States as SolarWorld has sought."

The government has also found that that some of the subsidies constituted export subsidies and as such the new import duties will be applied retroactively. The duties will apply from 90 days before the ruling is published in the Federal Register, likely to late December 2011.

The Coalition for American Solar Manufacturing (CASM) reacted positively to today’s initial finding. It issued a statement saying that it expects higher tariffs to be applied as alleged subsidies in terms glass are also taken into effect.

Furthermore, CASM contends that the Department of Commerce will also assess whether the Chinese manufacturers have illegally dumped solar products on the U.S. and if that is proven to be the case, then even higher tariffs still will be applied.

"Today’s announcement affirms what U.S. manufacturers have long known: Chinese manufacturers have received unfair and WTO-illegal subsidies," said Steve Ostrenga of Helios Solar Works, a founding manufacturer of CASM.

"If we address unfair trade practices in the U.S. solar market, we can get back to our business of expanding American manufacturing and jobs in the renewable energy sector," said Carlo Santoro, from MX Solar USA, also a member of CASM. "We look forward to getting back to the fair and legal competition that serves everyone best."

The lower than expected tariffs seem to have an effect on the stocks of Chinese PV companies as stock prices climbed at the New York Stock Exchange. Trina solar saw an increase of 7.85 percent, Suntech an increase of 14.06, Canadian Solar 6.41, JA Solar 4.4, Jinko Solar 5.63 and Yingli a good 12.07 percent (as of March 20, 7:39 p.m., EDT).

The Solar Energy Industries Association (SEIA), after the release of the tariff news, announced a new initiative to facilitate global and regional dialogues on trade and competitiveness and the role of government in encouraging development of the global solar energy industry. SEIA is supportive of a rules-based process for resolving trade disputes in the solar industry and the Department of Commerce’s investigation is certainly part of that process," said Rhone Resch, president and CEO of SEIA. "It is important to note that this is a preliminary determination and the antidumping decision will be rendered in May. If the tariffs remain at these levels, we do not think that this will have a material impact on the U.S. market."