China launches WTO case against EU solar subsidies

[November 06, 2012]  BEIJING (AP) -- China has filed a World Trade Organization case challenging subsidies provided by some European Union members to promote the solar panel industry, adding to its trade disputes with Europe and the United States.

Commerce Ministry spokesman Shen Danyang said China is requesting a consultation at the WTO. It is accusing some EU countries of providing subsidies for power generated by solar facilities in which the main components are made in European countries.

Shen said such subsidies "seriously damaged China's photovoltaic exports."

The statement issued Monday did not name the countries targeted in the WTO case, but the official Xinhua News Agency cited a Commerce Ministry official as saying that Italy and Greece subsidize projects that use EU-produced solar equipment.

The case follows an anti-dumping probe Beijing announced last week into European exports of polysilicon used in making solar panels, and the EU earlier began investigating whether Beijing was improperly subsidizing exports of solar panels.

China and its trading partners pledged after the 2008 global financial crisis to avoid taking actions that would hamper trade but have launched a series of anti-subsidy investigations and imposed punitive tariffs on some goods.

Solar and other renewable energy technology is especially sensitive because governments that are under pressure to cut high unemployment see it as a growth industry and source of well-paid jobs.

On Wednesday, the U.S. International Trade Commission is to vote on whether Chinese trade practices have injured the U.S. solar industry. It's the final hurdle in a more than yearlong effort by the U.S. to impose steep tariffs on Chinese solar panels.

Washington imposed tariffs of up to 250 percent on imports of Chinese-made solar panels this year to counter what it said was improper subsidies to the industry, but those tariffs aren't finalized unless the ITC votes to find harm to the U.S. industry.

The disputes have added to financial pressure on Chinese and other solar equipment producers that are suffering heavy losses due to lower sales and a price-cutting war.

[Associated Press]

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