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China Fights Back EU’s Taxes on Solar Panels by Putting Tax on Wine

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An employee dries newly made solar panels at a factory of a photovoltaic company in JiaxingThe European Commission confirmed their decision to impose duties on imports of solar panels from China, as of June, 6th. In return, the Chinese government announced their decision to launch an anti-dumping and anti-subsidy inquiry into European wine sales.

The initial rate of 47% on imported solar panels was reduced down to 11.8%, as some of the leading European economies including Germany and U.K. tried to prevent a trade war.

Chinese leaders are still convinced that EU duties are unfairly imposed, especially considering the efforts that Beijing has put into handling the issue.

As a result, China decided to strike the EU wine imports and hit some of the biggest EU economies, although authorities claim that the action is taken due to requests by Chinese wine producers. The country is known to be the biggest consumer and importer of European wine, especially French.

This move triggered strong reaction from EU members. France has called for a meeting of all EU members to discuss the issue, while Germany has pleaded for negotiations. Spain is particularly concerned, especially since wine production is one of the few sectors in the country’s economy, which are profitable.

According to experts, the Chinese reaction is very well calculated. It will definitely send the appropriate message, but at the same time it will not affect major industries within the EU.

The investigation on Chinese solar panels is the biggest out of the 31 ongoing investigations by the EU. Nevertheless, the lowering of the initial duty has been considered by China as an expression of willingness to resolve the issue between the two trading partners.

 

 

 

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