Trade War Looming as China Rebukes U.S. Support for Solar [View all]
China’s allegation that renewable- energy subsidies in five U.S. states violate free-trade rules ratchets up a potentially costly trade war between the world’s two largest economies.
“It’s a long, slow escalation of trade and currency wars as we race to the bottom,” said Theodore O’Neill, an analyst with Wunderlich Securities Inc. of New York.
Programs supporting renewable power, including wind and solar, in Washington state, New Jersey, Massachusetts, Ohio and California, violate World Trade Organization policies and trade treaties, according to a preliminary finding of an investigation posted yesterday on the website of China’s Ministry of Commerce. China filed a complaint today at the WTO over U.S. procedures for calculating anti-subsidy duties on imports.
Those announcements followed a preliminary decision by the U.S. Commerce Department last week to impose tariffs of as much as 250 percent on imports of Chinese solar cells. The agency said the units were being sold for less than the cost of production in an attempt to drive out domestic competition.