European Union Announces New Taxes on Chinese Solar Panels

The European Commission Building in Brussels. Photo: Sébastien Bertrand for Wikimedia Commons

The European Commission Building in Brussels. Photo: Sébastien Bertrand for Wikimedia Commons

On Tuesday, June 4 the European Commissioner, Karel de Gucht, announced that the European Union would implement higher taxes on Chinese solar panels.

Beginning on June 6, these taxes will reach 11.6%, and if no compromise can be made between the European and Chinese authorities within two months, the rate will be nearly five times as high at 47%.

These measures may be linked to the future free-exchange treaty between the European Union and the United States. Although these taxes aim to protect the European photovoltaic sector against the Chinese dumping practices, they will only be in effect for 6 months.

This decision from the European Commission would also divide the EU with more than 14 countries in Eastern Europe against the increase in tax. In addition to these countries’ misgivings, several key industrial groups, like Bosch, fear that these taxes will not be enough to revitalize the European photovoltaic market.

The Chinese Prime Minister, Li Kejiang, stated that this decision puts the “major economic interests” of his country at stake.

In response to the taxes set by the European Commission, the Chinese government decided Wednesday, June 5 to open two inquiries into wines imported from Europe concerning anti-dumping anti-subvention violations.

These inquires could prove harmful for European wine producers with China as one of its main exporters.  China buys more than an estimated 1 billion euros worth of European wine per year.  France especially would suffer as China is one of the top five countries that import French wine.

In order to protect one of its innovative industries, the European Commission may be risking one of its traditional sectors, which could in turn threaten the Europe’s economy.

Furthermore, the European Commission is jeopardizing the commercial relations between Europe and China, running the risk of igniting a commercial war between the two powers.

Trackbacks

  1. […] European Commissioner, Karel de Gucht, announced that the European Union would implement higher taxes on Chinese solar panels. Beginning on June 6, these taxes will reach 11.6%, and if no compromise can be made between the […]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: