Solar Panels From China May Get New U.S. Tariffs

The big trade news of the day is that United Steelworkers union (USW) has filed a petition with the US government alleging that the Chinese government unfairly favors, through subsidies and other trade measures, its domestic manufacturers of "green" goods like solar panels and wind turbines.  The petition was filed under a section of US trade law - Section 301 of the Trade Act of 1974 - that was once a strong protectionist weapon but has basically gone dormant since the advent of the World Trade Organization.

When I first wrote about last week's preliminary decision by the US Department of Commerce to impose big anti-dumping duties on imports of Chinese solar panels, I noted (among other things) that any final duties probably wouldn't lead to a long-term increase in US solar manufacturing but instead would simply cause Chinese production to move to other low-cost destinations (and, of course, raise US prices).

The New York Times reports today that the new US antidumping and countervailing duty investigations of Chinese solar panels is proceeding exactly as expected - by everyone other than the folks who petitioned for the case, of course:

The European Commission agreed to impose punitive import duties on solar panels from China in a move to guard against what it sees as dumping of cheap goods in Europe, prompting a cautious response from Beijing which called for further dialogue. EU commissioners backed EU Trade Chief Karel De Gucht’s proposal to levy the provisional duties by June 6 and make Chinese solar exports less attractive, two officials said.

Late last week the Chinese government announced new anti-dumping and countervailing duty (anti-subsidy) investigations of US and Korean imports of polysilicon - a primary input for the production of solar panels. China is investigating whether exporters from the U.S. and South Korea sold solar-grade polysilicon below cost, a practice known as dumping, as part of a probe following complaints from four domestic companies.

Over the last several years, China's subsidization of its domestic solar panel industry has attracted ire and envy in the United States.  Bankrupt US solar producers and the US politicians who subsidized them have been quick to deride pernicious Chinese subsidies - rather than their own political or policy mismanagement - as unfairly creating a global export juggernaut that has doomed their business.