Mariosa Vella Cardona’s article (June 13) China Solar Panel Duties Imposed By EU was a good explanation of one aspect of the invasion in Europe of Chinese solar panels which is being regarded by the EU authorities as dumping.
As she rightly pointed out, Chinese imports represent over 80 per cent of the European market and if measures against trading practices by third country exporters are not imposed, there is the real risk that jobs in Europe will be lost.
However that is only half the story because even before the European Commission acted, Lee Keqiang, the Chinese premier on a lighting visit to Berlin, had secured the backing of Angela Merkel against Germany’s imposing tariffs on Chinese panels.
Furthermore, 17 out of the EU’s 27 member states including the UK, the Netherlands and Sweden also added their protests against the commission’s action.
In addition, merely a day after the move by the commission Beijing reacted by saying that it would launch an investigation into European wine exports where countries like Italy, France and Spain were suspected of benefiting from illegal subsidies. Obviously it takes two to tango.
A harsh editorial in the Chinese People’s Daily issued a warning to the EU against a trade war stating that “shifts in global power have failed to change the condescending attitude of some Europeans”.
It is not China that is dumping its products. It is the EU which for the past 10 years has been living beyond its means, plagued by escalating wages, salaries and consequential inflation, which cannot keep pace with Chinese prices. In some cases Chinese wages are a third of EU’s rates for the same category of workers.
In all fairness the fact that China has such a big market in its own country and consequential economies of scale does not help European competitiveness.
However, if Europe is to have a chance of stemming the impending invasion of Chinese products (not just PVs) it has to go back to the drawing boards, trim its costs and come up with a leaner way of living for all of its citizens.
A trade war with China is not an option, particularly as possibly it could escalate into something more serious.