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China / Hot Issues

Protectionism stifles new energy

By Wang Li (chinadaily.com.cn) Updated: 2012-06-15 21:38

Dealing with the trade protectionism that has emerged in this gloomy global economic climate should be an important topic during the upcoming G20 summit.

For example, the United States continues to take protectionist actions against China, the latest of which came in May, when it imposed its highest punitive tariff ever on Chinese solar cell companies.

There is a widely held belief in the US that the country lags far behind China in the clean energy race, which is far from true.

Currently, Chinese manufacturers of solar cells face many difficulties, such as domestic overproduction, a sluggish European market and the slow recovery of the global economy. If the US Department of Commerce's ruling becomes final, China's solar cell companies will lose 10 percent of their market share.

The spread of trade protectionism against China reflects the objective of curbing the rise of China. Lurking behind the high anti-dumping duty against Chinese solar energy enterprises is the so-called China threat theory. The US worries that the rise of China will threaten its position.

Suppressing the development of China's new energy industries is part of the political game between the two great powers. At present, there is a balanced situation of new energy trade between China and the US. China is the technical exporting country in terms of nuclear power and the technical importing country in solar energy.

In the field of wind power equipment manufacturing, both Chinese and US manufacturing enterprises are localized, except GE has some production lines in China. In this aspect, in the field of alternative energy, China and the US are actually closely connected competitive partners.

Competition in this field is the manifestation of how the two countries try to seize international market and discourse power in the post-crisis era, which is the game that is being played strategically at the national level. The US has to find excuses to curb China's rapid development, allowing the US to play the leading role in the new energy industry.

These high anti-dumping duties are the inevitable result of severe competition between China and the US in the field of new energy. Given the international trend that is moving toward green and low-carbon economy, China and the US are making all efforts to develop the domestic new energy industry.

Since both countries have obligations to reduce carbon emission, they face urgent tasks to upgrade domestic industries and adjust economic structures. Promoting new energy is undoubtedly the best choice for both.

During the race to occupy the international new energy industry market, US alternative energy enterprises have felt great pressure from the rise of China. To hold on to its leading role in this field, promote its new energy technology and products and make super profits, the US will try to fight against its competitors by all means.

At the turn of the 21st century, energy security and climate change are the common problems of humanity. Only when China and the US make joint efforts to dispel trade disputes caused by protectionism, can the new energy industry harmoniously develop for the good of all.

The US tries to curb the development of China's new energy industry at the cost of undermining that of the global industry as a whole. This kind of anti-dumping duty is no good for anyone. Making China the imaginary enemy to curb China's development in this field not only harms US enterprises in China but also hinders the process of coping with energy security and climate change internationally.

The author is a researcher with Chinese Academy of International Trade and Economic Cooperation, affiliated to the Ministry of Commerce.

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