A MAJORITY of EU governments oppose a plan to impose hefty duties on solar panel imports from China, a survey of member states showed yesterday, undermining efforts by Brussels to pressure Beijing over its trade practices.
The European Commission, the EU's executive, accuses Chinese firms of selling solar panels at below cost in Europe - a practice known as "dumping" - and plans to impose duties, making it far harder for China to gain market share.
The duties, averaging 47 percent, will come into force from June 6 for a trial period and could be withdrawn if both sides can reach a negotiated settlement. Chinese officials were holding talks with EU officials in Brussels yesterday.
The case is the largest trade case the commission has undertaken, with around 21 billion euros (US$27 billion) of Chinese-made solar panels sold in the EU. The duties are being proposed by the EU's trade commissioner Belgian lawyer Karel De Gucht.
But fearful of losing business in China, Germany, Britain and the Netherlands are among at least 15 member states who oppose the sanctions.
The EU's 27 countries had until Friday to submit a formal, written response to De Gucht's plans. While the trade commissioner would still have the right to impose the duties, doing so in the face of member states' opposition would be hard.
Provisional duties will more than likely still go ahead on June 6, once they are published in the European Union's official journal, officials say, but the pressure to roll them back before they become permanent in December will be intense.
The split underlines the depth of division in the EU over how to deal with China, a critical market for many EU exporters and the region's second biggest trading partner over all.
Reuters spoke to 21 of the EU's 27 countries and confirmed that 15 opposed the duties while six supported them. The other six either declined to say or were unreachable.
France and Italy are leading a group of countries who say De Gucht is right to go ahead with sanctions, arguing that China's rapid rise in solar panel output to more than the world's entire demand could not have happened without "illegal state support."
Chinese companies have captured more than 80 percent of the European market from almost zero a few years ago.
De Gucht met China's deputy commerce minister for informal talks in Brussels yesterday, a day after Chinese Premier Li Keqiang and German Chancellor Angela Merkel, meeting in Berlin, called for an end to the dispute, as well as another conflict over Chinese telecoms companies accused of dumping in Europe.
Germany initially supported De Gucht's plans for duties, and it was a German company, Solar World, which first raised the complaint against Chinese dumping. But rather than punitive measures, Merkel now appears to favor a negotiated solution, wary of the potential impact on German exporters if China were to take retaliatory steps.
"There is no need for more sanction measures," German Economy Minister Philipp Roesler told a news conference yesterday after talks with Li.
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