A number of prominent China-based solar energy companies saw their stock rise substantially on Monday (July 14), thanks to the World Trade Organization’s recent ruling against the US imposition of tariffs on Chinese solar modules, steel products, and other exports.
According to the WTO, tariffs violate global trade rules — being inconsistent with obligations under the 1994 Marrakesh accord. Notably, though, the WTO also rejected some of the arguments being used by Chinese proponents against the tariffs.
Image Credit: Flag of China on Yangtze River via Shutterstock
As far as solar stocks go, they rallied on Monday. Yingli Green Energy rose by 4.8%, China Sunenergy by 5.5%, ReneSola by 3.1%, Trina Solar by 2.6%, and Jinko Solar by 2.8%. The US-based company SolarCity, which relies heavily on imported Chinese-modules also rose, by 2.4%.
Reuters provides more:
In the $7.2 billion Chinese case, the panel found that Washington had overstepped the mark in justifying the so-called countervailing duties it imposed as a response to alleged subsidies to exporting firms by China’s government.
Under the 1964 Marrakesh accords, which also set up the WTO, these duties can only be levied when there is clear evidence that state-owned or partially state-owned enterprises passing on the subsidies are “public bodies.”
The panel found that Washington had produced insufficient evidence for this, and was also at fault in its calculations of the value of the subsidies to Chinese firms producing items like kitchen shelving, grass cutters and even citric acid.
In related news, China is now the world’s largest solar PV market, according to the Global New Energy Development Report 2014. The eastern powerhouse surpassed Germany to take the top spot.
Among the other interesting findings of the report are that “38.7 GW of new solar PV capacity was installed in 2013, and that out of that total figure 12 GW was installed in China — that’s a 232% increase over the previous year in the eastern manufacturing powerhouse.”
Perhaps the trade war between the US and China is less important than it appears at first glance? The times do seem to be changing.
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