Outlook for China solar industry darkens after U.S. tariff decision: govt

BEIJING (Reuters) - The outlook for overseas expansion by Chinese solar companies is not optimistic due to frequent trade disputes, the country’s Ministry of Industry and Information Technology (MIIT) warned in a statement on Tuesday.

“China’s solar industry has been growing at a fast pace in recent years, making itself a target of protectionism in some countries,” the MIIT said, adding the disputes have hindered Chinese solar companies from expanding overseas and would add to the costs in the global solar market.

The MIIT comment followed U.S. President Donald Trump’s decision on Monday to slap 30 percent tariffs on solar cell and module imports to try to protect domestic manufacturers.

India this month said it would consider imposing 7.5 percent import tariffs on foreign solar panels as some Indian companies complained of cheap Chinese products flowing into the country.

Despite the disputes, the MIIT said it will continue to encourage Chinese solar companies to moderately expand businesses overseas.

China, the world’s biggest solar panel maker, produced a total of 68 gigawatts(GW) of solar photo-voltaic cells and 76 GW of solar modules in 2017, up 33.3 percent and 31.7 percent respectively compared to a year ago, data from the MIIT showed.

Expansion of production capacity helps Chinese solar enterprises to reduce production cost and to boost exports.

Over the first 11 month in 2017, the export value of Chinese solar products rose by 1.4 percent to $13.11 billion, driven by growing renewable market in emerging countries such as India, Brazil and Mexico.

China’s domestic solar market has been struggling with delayed subsidies and high curtailment rates as power generated from solar plants cannot be absorbed by the grids due to insufficient transmission capacity.

Reporting by Muyu Xu and Josephine Mason; Editing by Keith Weir