The US government has decided to emplace a tariff on solar panels imported from China. The act of protectionism came after the US International Trade Commission found that illegal dumping from Chinese competitors was harming domestic solar panel manufacturers. If confirmed that the US industry is affected by the dumping, the government will impose a high tariff for most solar panel manufacturers.
The dumping that the Chinese producers have been accused raises concern for the US solar market industry. The dumping implies that the exporters are losing money intentionally on the solar panels and therefore are preying on domestic solar panel producers and stealing away domestic consumers with unsustainable low prices.
The US department of commerce’s decision to impose higher tariffs on solar panel manufacturers from China may not be beneficial to either country, as the tariff will reduce the quantity of imports demanded due to the increased price, increase production costs for domestic producers, and limit options and raise prices for consumers. It may also worsen the trade conditions between the two countries.
Although these problems exist, the government will benefit from increased tax revenue from the Chinese solar panel importers.
Works Cited:
Ryan Tracy. “U.S. to Hit China With Solar-Panel Tariffs.” WSJ. WSJ, n.d. Web. 14 Nov. 2013.