Solar panel deal can help settle other disputes with China

An "amicable solution" to a dispute over EU imports of Chinese solar panels may help settle other spats, which have hurt ties with Beijing and stoked fears of an outright trade war, a top European Union official said on Monday. "We will need such a constructive approach between China and the EU also for other cases affecting our trade," EU Trade Commissioner Karel De Gucht said. "I sincerely hope that the solution we found in the solar panels case will set the tone for these discussions." De Gucht announced the accord on Saturday as the two sides, who are major trading powers and partners, remain locked in a series of tit-for-tat disputes on other products ranging from steel pipes and telecoms equipment to wine and chemicals. The Commissioner said that while telecoms were not mentioned in the talks, Chinese anti-dumping probes into imports of EU wine, and of polysilicon -- a key component for solar panels -- were touched on. China would not impose punitive tariffs on EU polysilicon before April 2014, De Gucht noted, and "within this period there would be a window for discussion" between Brussels and Beijing. Similarly for wine, there would be no Chinese punitive action before June next year and again this would allow "a window for discussions," he said. France notably said on Saturday in welcoming the deal that it hoped that in return, "the Chinese authorities will end their anti-dumping probe into imports of EU wine." Solar panel manufacturers complained they had been sold out and importers said they would suffer higher prices as a result -- but De Gucht defended the agreement as the best possible. The twin objectives were to "remove the injury to European industry caused by illegal dumping and at the same time ensure that European users and customers benefit from cheap supply of solar panels." To do this, Chinese exporters agreed to a minimum price which will provide a floor for the market up to a certain threshold of imports, De Gucht said, declining to give detailed figures until the deal is formally approved by all 28 EU member states on August 2. Diplomatic sources said earlier the minimum panel price would be equal to 56 cents per watt of power they produced, applied to the first seven gigawatts of solar panels imported. Any imports above that limit would incur an average anti-dumping tariff of 47.6 percent, the sources said. In June, after months of recriminations, Brussels imposed an emergency anti-dumping tariff of 11.8 percent on imports of Chinese solar panels in its largest ever such action, rising to an average 47.6 percent if no settlement was reached by August 6.