The best to be said for the Beijing-Brussels compromise over the trade in solar panels is that it has averted a wider trade war between China and the EU. But peace has been bought at the price of selling out the interests of ordinary Europeans and the environment to the bad practices of corporatism.
Following an anti-dumping investigation, Karel De Gucht, the EU’s trade commissioner, imposed tariffs of 11.8 per cent on solar panels imported from China. These were set to jump to 47.6 per cent next week. Instead a deal was struck to let Chinese companies sell up to 7GW of capacity into the EU a year so long as they undertake not to undercut an agreed floor price. Otherwise the full import duty will apply.
This “compromise” is possibly even worse than the unilateral action Mr De Gucht had first threatened. The price commitment-cum-quota inflicts the same harm as outright tariffs on Europeans eager to “green” their energy consumption. A higher purchase price for solar panels discourages their installation, which penalises not just consumers but installers and makers of polysilicon – the high-tech raw material some European producers have been supplying to Chinese solar cell manufacturers.