Anti-Dumping and China
Posted by w_thames_the_d on December 3, 2013
Below is a comment from anonymous and my two pennies. Anti-dumping duties are designed to protect local manufacturers from unfair trade practices. ‘Dumping’ is one an example where firms from a country sell below their cost. They do this for many reasons
– gain market share
-support overcapacitized industries
-drive out business in order to get a monopoly later
Selling below cost means a firm loses money. It also means that it is selling at a rate which is hard to compete with. As a result of dumping, indigenous firms collapse. Anti dumping laws are geared to protect from this.
The excerpt speaks to this issue but the real problem is that the Chinese have no ‘logic bone’ but only the ‘kill the family and make a buck’ bone. They have created twice as much capacity for solar panels than the world now needs. Yes, China did this.
Consequently, the Chinese need to drive sales and cutting price is the only way. They have staked their horses to this tech and when the industry dives, they will suffer. The EU is fighting back and the chicoms are pissed…
EU imposes anti-dumping measures on some Chinese solar panels
Brussels: The European Union will on Friday begin imposing anti-dumping measures on some Chinese solar panels whose manufacturers rejected an amicable settlement.
The two-year measures will enter into force on Friday December 6, said the EU Commission, and will apply to those panels produced by Chinese manufacturers who rejected a deal to diffuse a brewing trade war.
The Commission said in a statement that “the final anti-dumping and anti-subsidy duty rates will apply only to those exports from China which do not meet the conditions set out in the undertaking.”
China and the EU reached in July an amicable settlement under which Chinese exporters agreed to a minimum price to provide a floor to the market up to a certain threshold of imports, after which anti-dumping tariffs apply.
Inexpensive Chinese-made solar panels have flooded the European market in recent years, sparking complaints from European manufacturers.
This triggered the EU’s biggest-ever trade probe covering a market worth some 21 billion euros (USD 28.5 billion) initially, although this has since fallen dramatically due to overcapacity and tumbling demand.