Deng Shuwen: China needs to lift the stick to the EU

Deng Shuwen: China needs to lift the stick to the EU

The anti-dumping tariffs levied by the European Union on Chinese PV products, involving US$20 billion in exports and 500,000 directly employed people, have become a window for the international community to observe the development of China-EU economic and trade relations and even political relations. My opinion is that since the EU does not care about China’s concerns and warnings, and “has not been tolerated,” China should also not hesitate to counter the EU. In other words, China’s current double-counter investigation into EU wines should be only the first step. Follow-up must introduce more stringent countermeasures so that the EU can truly understand the truth that it is not worth the loss and the loss of both sides.

Many people may oppose the trade war and believe that there is no winner in the trade war, but China must do so if the EU does not correct it. The reason is that regardless of whether China’s PV products enjoy state subsidies, the EU’s sanctions against China are purely detrimental to people and a naked trade protection act.

The photovoltaic industry has become an industry in the world. In the process of developing the photovoltaic industry, countries have formed the pattern of “I have you and you have me”. Any behavior that restricts the market will bring losses to the Chinese PV companies. It will also become an obstacle to the development of European PV applications and will have a significant negative impact on the EU's real economy and employment. The research report published by the consulting firm Prognos in Germany pointed out that punishing tariffs on Chinese companies can bring certain benefits to the photovoltaic products companies in Europe, but the jobs created by them can only make up for the 1/1 reduction in the number of jobs in other areas. 5. In Germany, more than 84,000 jobs will be lost in only 3 years, while 242,000 jobs will be lost in the EU.

Perhaps in view of this double-edged sword effect, in the previous investigations, the EU’s internal opposition to the European Commission’s double counter-sanctions was also very loud, with 18 countries clearly expressing their opposition. However, the European Commission has still made a decision on sanctions. The reasons are as stated by some experts. The EU’s attitude toward exclusion from Chinese products has a long history. Since the EU has not recognized China’s market economy status so far, it can arbitrarily explain the so-called dumping of Chinese companies. Behavior, with a strong purpose, is to ensure the survival and competitiveness of the EU's own business. While the competitiveness of European photovoltaic products is not an opponent of Chinese companies in any respect, the EU can only adopt this typical protectionist policy. "From a small perspective, it is to block China's PV products from the EU market. From a large perspective, it is to suppress China's expansion in the international market and smooth the way for the EU's economic recovery."

Therefore, with regard to the EU’s practice of behaving like a beggar, China can only raise its stick. The need for big sticks also lies in that China is no longer a small economy. It can negotiate and make concessions in exchange for cooperation between the two sides. China’s economic size is too large. In the face of this game of major economic interests, if China chooses single Concessions on the side will send a wrong signal to other countries, thinking that China is a paper tiger and will accept sanctions from other countries for certain historical opportunities. Once China gives this impression to the world, it will undoubtedly induce more anti-dumping actions against Chinese products. Therefore, we must counterattack and there is no escape route. Even if this leads to a double loss, let other countries realize that it is outdated to swing the stick at random.

Of course, counterattacks are about strategy. This double counter-report on EU wines is very accurate. In the European Union’s sanctions on China's photovoltaic industry, France and Italy have played the role of “leader brothers” and the counterattacks are mainly directed against them. China's wines are mainly imported from the European Union. Both France and Italy are big producers of wine. Therefore, the investigation of double-counter wines has the meaning of punishing the two countries.

Although we have always called on the EU countries to recognize China’s market economy status, in the trade between the two sides, we used to be somewhat self-contained. We checked ourselves too much and did not examine each other. If the standards of the same rule are used, many EU companies do not all comply with trade rules. Therefore, since they are now picking up bones in the eggs, we must have countermeasures, and we must even take the initiative to attack instead of responding passively so that an equilibrium can be achieved.

While doing a good job of counter-measures, we must also make preparations for both, accelerate domestic economic restructuring, increase the technological content and levels of the industry, and promote industrial upgrading. As far as the photovoltaic industry is concerned, it is necessary to place strength in the country because the world's largest and most promising solar energy market is in the country. However, this needs to eliminate the domestic policy barriers to the development of the photovoltaic industry and formulate relevant laws, regulations, and power and financial policies as soon as possible so as to promote and realize the application of photovoltaic power generation. China's strong support for the photovoltaic industry in the past few years has led to excessive development of the industry, serious product homogenization, and excessive dependence on external demand. The fall of Suntech is very illustrative.

The earth on which human beings are living is facing an increasingly serious energy crisis and environmental crisis. Traditional energy sources are not only depleted, but also have large environmental pollution and hidden costs. The clean energy including solar energy, wind power, nuclear power, and clean coal is human. The way out for the future. In this area of ​​development that is vital to the overall interests of mankind, China is catching up. Therefore, the EU's dual counter-measures must not hinder the development of China's photovoltaic industry. Deng Shuwen (political columnist)

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