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Commerce Department Lowers Boom on Chinese Solar Producers with Tariff…in Perhaps the Softest Manner Possible

The Commerce Department and Obama Administration wanted to send a message to China that it knew there was unfair assistance going to those in its solar products manufacturing sector from the government, and thus, imposed a tariff. However, most analysts and domestic solar producers lambasted the tariff as a shockingly weak inroad at punishing Chinese manufacturers with a perceived unfair advantage, at best, and a death knell into insolvency for some badly struggling U.S. producers at worst.

Commerce announced it believed the Chinese government was illegally subsidizing companies producing solar energy products there, and the companies, in turn, have been dumping its products in the United States at artificially low prices, hurting American competitors. It responded with the announcement of a tariff – a widely anticipated move that had market-watchers predicting it could be set at 20%, perhaps 30%. Instead, Commerce emerged Tuesday with an underwhelming range for the tariff: 2.9% to 4.3%. In essence, the move was not greeted as something that would help domestic producers in any significant fashion, all while further antagonizing key trade officials in China who have been engaged in a trade-based rhetoric battle with its U.S. counterparts recently. For their part, Chinese officials proclaimed such a tariff, in the end, would drastically increase prices and decrease availability of solar energy products in the world market.

Brian Shappell, NACM staff writer