(Corrects yuan figure to U.S. dollar figure in headline)
SHANGHAI, Sept 28 Banks in Wuxi, Jiangsu
province, have extended new loans totalling 200 million yuan
($31.73 million) to locally headquartered solar power giant
Suntech Power Holdings Co Ltd, the Shanghai
government-owned China Business News reported on Friday, citing
Suntech, the world's largest maker of solar panels, whose
shares hit a high of $90 in early 2008, runs the risk of being
removed from the New York Stock Exchange for failing to keep the
average closing price of its shares higher than $1 over the last
30 trading days as of Sept. 10, Suntech said in a statement on
Shares in Suntech, like rivals JA Solar Holdings Co
, Trina Solar Ltd and Yingli Green Energy
Holding Co, have fallen sharply in the past three years
as sales prices have tumbled, squeezed by declining demand in
export markets and overcapacity at home.
Debt-laden Suntech's shares have also been hit after it said
in July that its partner in a solar development fund might have
defrauded it with a bogus collateral pledge of hundreds of
millions of euros of German bonds.
Local governments that invested heavily in supporting the
development of solar power companies in their regions now face
the likelihood of big local unemployment problems if those firms
collapse. Last week Suntech announced it would lay off around
1,500 people from one of its plants in Wuxi.
LDK Solar, which reported a second-quarter loss
nearly three times bigger than a year earlier, has also recently
received local government money. In July the government of Xinyu
in Jiangxi province announced it would use taxpayer funds to pay
off some of the company's loans.
Beijing has asked provinces to provide plans as to how they
will increase solar energy in their power mix by 2015, and state
media reported that China Development Bank is preparing plans to
provide further credit support, but all of this help has caused
complaints in the U.S. and Europe.
The U.S. imposed import duties on Chinese solar panels as of
May, and an anti-dumping investigation against Chinese solar
companies is underway in Europe. The erection of trade barriers
against Chinese solar products would make it even more difficult
for the industry to resolve its capacity and inventory gluts.
Local branches of Bank of China Ltd ,
Industrial and Commercial Bank of China Ltd
, Agricultural Bank of China Ltd
, China Construction Bank Ltd
and policy lender China Development Bank
joined together to make the loan, the report said.
($1 = 6.3025 Chinese yuan)
(Reporting by Pete Sweeney; Editing by Daniel Magnowski)