SEIA propose compromise to end China-US trade spat

The SEIA has announced a set of proposals that it hopes will bring to an end the trade dispute between the U.S. and Chinese solar markets.

Both countries have this year introduced duties on imports of solar equipment originating from the other country: the U.S.’s antidumping ruling on government-subsidized PV products from China, and China’s 57% duty on polysilicon imports – the main component in U.S.-produced solar cells.

Under the SEIA’s new proposals, such prohibitions would be lifted and funds would be established to help support the solar industry in the U.S. Since the antidumping ruling, Chinese manufacturers have tried to circumvent the law by assembling their modules using cells sourced from a third-party country, thereby avoiding the additional duty to be paid on Chinese-sourced modules.

Such behavior, contends the SEIA, is creating adverse conditions for the global market, which is in turn harming both the U.S. and China without addressing the initial problem – that of unfair trade competition.

The proposed “win-win” solution put forward by the SEIA revolves around the establishment of a U.S. Solar Manufacturing Fund and the creation of a U.S. Solar Development Institute; both of which would be funded by Chinese solar manufacturers.

The fund would, say the SEIA, be used to finance capital investment in R&D, facilities and equipment for the U.S. solar industry, while the institute would provide better training and a wider scope to expand the U.S.’s solar manufacturing base.

Funding would be skimmed from the premiums Chinese manufacturers currently pay in order to source third-party components. The money is there, the SEIA argue, but is being spent on avoiding the problem, rather than solving it.

In return, the U.S. would repeal its antidumping law and China would drop its polysilicon duty, with both nations agreeing to suspend any future prohibitions or trade impositions for a five-year term, plus 12 additional months thereafter. Such a development would, believe the SEIA, enable the U.S. to bring down the costs of its own modules, minimizing the requirement for further industry regulation.

Initial responses to the proposals were not altogether positive, particularly throughout the U.S. solar manufacturing industry. However, some prominent U.S. Senators (including senators Maria Cantwell and Patty Murray) have expressed their support.