China has lodged a complaint before the World Trade Organization to determine the legality of a U.S. decision to impose safeguard tariffs on imported solar cells and modules.
U.S. President Donald Trump on Jan. 23 issued Proclamation 96931, imposing global tariffs that took effect Feb. 7. The tariffs were in response to the U.S. International Trade Commission's findings that increased imports of certain crystalline silicon photovoltaic cells are a "substantial cause of serious injury to domestic manufacturers."
Imports of such materials would be hit with tariffs in the next four years — 30% in the first year, 25% in the second year, 20% in the third year and 15% in the fourth year.
China's Ministry of Commerce said Aug. 14 that the U.S. measures violate the WTO Agreement on Safeguards. This not only harms the rights and interests of the Chinese but also undermines the authority of the WTO, the ministry said on its website.
Trump's policy also gives the U.S. renewable energy industry an unfair competitive advantage, distorting the international market for products such as photovoltaic cells, the ministry added.
China said its response to the U.S. dispute resolution mechanism is a "necessary measure to safeguard its legitimate rights and interests and maintain multilateral trade rules."
The U.S., in turn, has accused China of using subsidies and bulk manufacturing capacity to drive down prices and put U.S. manufacturers out of business, Reuters reported Aug. 15. U.S. solar module production capacity fell to 1 gigawatt in 2017 from 1.5 GW in 2011 as a result of bankruptcies, according to data from the China Photovoltaic Industry Association.
In China, solar power manufacturers could also face a wave of closures after the state planning agency said it plans to limit additional capacity at 30 gigawatts this year, down from 53 GW in 2017, Reuters reported.