The United States (US) has imposed new tariffs on solar panel imports from four Southeast Asian countries, reaching up to 3521 percent, bringing a major victory to domestic manufacturers, but also further hindering the development of renewable energy sources in the country, writes Bloomberg.
The tariffs, announced yesterday, are the result of a year-long trade practices investigation that found solar panel manufacturers in Cambodia, Vietnam, Malaysia and Thailand were "unfairly profiting from government subsidies and selling their products in the U.S. at prices below their cost of production."
The investigation was requested by domestic solar panel manufacturers and was launched during the tenure of former President Joe Biden.
While these tariffs will benefit American manufacturers, they will also make it significantly more difficult for American renewable energy producers, who have long relied on cheap imported components, further increasing uncertainty in a sector that is already exposed to frequent political and regulatory changes in Washington.
Wide range of customs
The tariffs come on top of a wide range of tariffs imposed by US President Donald Trump that have already shaken global supply chains and markets. The Commerce Department's decision is a victory for domestic manufacturing, something both Trump and Biden have sought to encourage. Potential winners include Hanwha Q Cells and First Solar Inc, among others.
Although promises of subsidies and demand spurred by Biden's Inflation Reduction Act have led to a wave of interest and investment in new domestic solar panel factories across the US, manufacturers have warned that these factories are threatened by foreign competitors selling equipment below market price, Hina reports.
"This is a decisive victory for American manufacturing," said Tim Brightbill, co-chair of the international trade practice at Wiley and lead attorney for the coalition of solar companies that brought the case.
"The findings confirm what we have long known: that Chinese solar firms are cheating the system, undermining American companies and taking jobs away from American workers," he added.
Customs duties of 3521 percent
Country-wide tariffs reached as high as 3521 percent for Cambodia, reflecting that country's decision to stop participating in the investigation, according to the Ministry of Commerce.
The US imported $12,9 billion (€11,19 billion) worth of solar equipment from those four countries last year, accounting for about 77 percent of total solar module imports.
Unnamed companies from Vietnam face tariffs of up to 395,9 percent, while Thailand is set at 375,2 percent. Malaysia is set at 34,4 percent. Jinko Solar must pay tariffs of about 245 percent on exports from Vietnam and 40 percent on exports from Malaysia. Trina Solar in Thailand faces tariffs of 375 percent, and from Vietnam more than 200 percent. JA Solar modules from Vietnam could be taxed at about 120 percent.
Share prices of Chinese solar companies were largely unchanged after the market opened today: Trina fell 1,6 percent, Jinko by 0,9, and JA Solar by 0,1 percent, as the US decision was largely expected and companies were already moving some of their production to tariff-free countries, such as Indonesia and Laos.
"We do not think higher rates will have a significant financial impact, especially after the recent reciprocal tariffs," BofA Global Research said in a note.
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