Chinese solar panel makers face dilemma as US plugs trade loophole in Southeast Asia
- US has opened investigations into solar panel products from Southeast Asia to block a well-trodden tariff workaround used by Chinese firms
Mounting uncertainties are casting a shadow over the future of Chinese solar panel manufacturers in Southeast Asia, with many agonising over staying or leaving given the United States is moving to block a well-trodden tariff workaround.
Many firms have halted production in the name of “facility upgrades” or “maintenance”, or furloughed workers after the US Department of Commerce opened anti-dumping and anti-subsidy investigations into crystalline silicon photovoltaic cells from Cambodia, Malaysia, Thailand and Vietnam in May.
The US made the move after domestic solar companies alleged that China has been trying to circumvent tariffs by shifting manufacturing to Southeast Asian nations.
Analysts said investigations highlighted the challenges faced by Chinese manufacturers and the significance of finding alternative markets because the European Union or other Western countries could follow suit.
“If they don’t have the US market, they should capture the demand in the Middle East or other major developing countries,” said Terence Chong Tai-leung, an associate professor of economics at the Chinese University of Hong Kong.
A temporary exemption from anti-dumping and countervailing duties of 200 per cent granted by the US in 2022 on certain solar cells and modules from Cambodia, Malaysia, Thailand and Vietnam expired on Thursday, according to a report from international law firm Kilpatrick.
