Trade war with China over solar panels

Discussion in 'Current Affairs, News and Analysis' started by Cold_Collation, May 9, 2013.

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  1. Cold_Collation

    Cold_Collation LE Book Reviewer

    Mixed feelings over this. We should use more solar and cost has historically been a barrier. Wind farms and other green policies ain't gonna cut it and our energy policy in this country is a shambles.

    On the one hand, who cares if the Chinese products are subsidised, so long as we have a cheap source of them. On the other, is it a classic loss-leader situation where they're looking to put everyone else out of business?

    Opinions?

    Europe on verge of trade war with China over cheap solar panels - Telegraph
     
  2. It does appear to be a Chinese trick, copied from everybody else. Undercut everybody till all their businesses go bust and then start to creep prices up. They did the same trick with the Rare Earth Mineral mines, added to which they threw trade restrictions as the Chinesse claimed they needed the rare earth for their own use.

    That sort of back fired as it pissed off a lot of people who decided that the Good Ole US of A needed it's own sources and started reopening the mines that had closed when the Chinese kept dropping prices..... The Japanese are working hard at Sea mining and may have made a breakthrough

    The Pacific Dream: An Underwater Rare Earth Behemoth | Rare Earth Investing News
     
  3. It does seem somewhat hypocritical for the EC to use subsidisation as a reason while the CAP gravytrain trundles along quite happily.
     
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  4. Thing is, like so many policy overspills, it's aimed internally and not abroad at all.

    The polluting effects of coal (mining and burning) are a serious problem in China and while they need ever-increasing energy supply they also need to cut back on emissions from their power plants.

    Nuclear is one option they're pursuing but anywhere there's a realistic renewable option they're going all out for that - it's entirely possible to drive through southern Gansu without seeing a single home that doesn't have it's own solar panel (and a watermill or zhaoqi methane facility depending on circumstances).

    To make these panels affordable for peasant farmers, the manufacturers have had to bring the unit cost right down which they can only really do through massive production runs, the excess of which need to be sold somewhere. Ironically, the only alternative would be increased government subsidy which is the very substance of the EU complaint.

    The same grassroots environmental complaints which are driving diversified energy production were also a factor in restricting rare earth exports. It's never been a secret that there were larger deposits elsewhere, it's just that for some countries it wasn't economic to mine theirs while the Chinese operations were keeping the price down; while others were simply unwilling to shit on their own doorstep to fund their addiction to electronics. Once the Chinese cut their export quotas, quite a few of the other countries suddenly found themselves with a profitable mining industry while PRC was able to cut pollution and bodyswerve accusations of monopolisation.

    Apart from on here, obviously.
     
    • Like Like x 2
  5. Cold_Collation

    Cold_Collation LE Book Reviewer

    S_a_C, that's quite a heartening post. It's interesting that many people point at the US and its wastefulness and then preach about being greener/energy security, and yet when the Chinese do something like this there's an assumption of darker, rather than pragmatic, reasons.
     
  6. Grumblegrunt

    Grumblegrunt LE Book Reviewer

    china is having to subsidise them or they will collapse - they spent a billion building huge factories then the orders switched off in 08. prices have been plummeting since. there are worries that the 30 year boom is coming to a close and china has to cut it off internally to make it manageable before the markets induce a collapse.

    plus technology is coming close to rendering the old panels useless as they can now make panels using a printers and special inks.
     
    • Like Like x 1
  7. Yes, it's rather tiresome isn't it? Almost as if people are deliberately looking for an excuse for their preconceived position rather than 'seeking truth from facts'.

    I recently read an interesting critique of US anti-dumping policy and how free trade regulations are used to restrict market competition safe in the knowledge that Chinese suppliers lack the funds or know-how to defend themselves in US courts. I'll post a link when I get home.
     
  8. I'm just waiting for the time when a lot of panels will be at end of life and need disposing of.

    Considering these panels are exempt from the EU dangerous substances regulations. Some body will have to foot the bill for disposal.
     
  9. The subsidies were there to promote production so that costs could be kept within the means of property owners. It's a strange facet of Chinese economic planning that provinces set their own targets for both production and consumption - only a few areas went for grants to homeowners rather than shaping the market and then mostly in ethnic minority areas.

    They weren't worried about the panels not being the latest technology and so R&D wasn't a priority. Getting people off coal or even electrified for the first time ever was the ultimate goal and good enough was good enough.
     
  10. China subsidized solar to grab global market share in a green industry. In order to fuel future growth of Chinese economy at the expense of the rest of the world.

    It comical to imply these subsidies were meant to support production for the local Chinese market.

    Chinese solar was a mercantilist policy that went out of control because of over investment in the Chinese solar industry.

    EU has the choice of letting EU solar industry die are following US lead in stopping Chinese from flooding its market with under priced solar panels.

    In the end protecting your local solar industry and just waiting for Chinese solar industry to implode from debt is the best course.
     

  11. It's impacting german solar manufacturers and therefore is a European wide problem. We'll now see the the EU is designed to deal with German issues in the main.

    If the Chinese have been dumping onto the market then why isn't the WTO dealing with it.
     

  12. We'll be footing the bill.
     
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  13. I am always very suss about anything the Chinese do. I have no confidence in that society to do anything that will benefit mankind or the planet in general.
     
  14. Looking at where the bulk of production actually went makes it look less comical. Yes, there was a mercantile aspect to how they disposed of the excess but that was secondary to their main reason.

    It's inconsistent that if they'd been intending to steal a march in market share and were capable of carrying out a conspiracy on such a grand scale, they'd suddenly lack the foresight or ability to keep that up when it came to technological progress.

    Sometimes, a cigar is just a cigar.
     
  15. Even if you were right, they wouldn't be unique in that respect. Doing the same as any other country only bigger doth not 'evil' make.