The U.S. International Trade Commission (ITC) recently concluded that solar cells and modules imported from Cambodia, Malaysia, Thailand, and Vietnam are causing harm to U.S. manufacturers.
Over the past year, the United States has engaged in a prolonged trade “game” centered around solar products. This followed a year-long trade investigation initiated by the U.S. Department of Commerce at the request of American solar manufacturers and launched during the tenure of former President Joe Biden. The investigation found that solar product manufacturers in Cambodia, Malaysia, Thailand, and Vietnam were deemed to have unfairly benefited from government subsidies and were exporting products to the United States at prices below their production costs. The final decision on imposing tariffs rested with the ITC, hinging on its ruling regarding whether domestic producers were being harmed or faced a threat of harm from these imports.
On Tuesday, the ITC formally voted, concluding that solar products imported from these four Southeast Asian countries indeed pose a threat to U.S. domestic manufacturers. Companies such as Hanwha Q Cells and First Solar Inc. have long accused the influx of low-priced products from Southeast Asia into the U.S. market of creating significant challenges for their domestic production and equipment sales. Despite the authorities’ vigorous promotion of advanced energy technology manufacturing within the country and the introduction of a series of tax incentives, the situation has not effectively improved.
According to the tariff rates actually calculated by the U.S. Department of Commerce last month, there are significant disparities in the rates faced by different countries and enterprises. Some manufacturers in Cambodia face tariffs as high as 3521%, while rates for other countries and enterprises are considerably lower. Vietnam’s average tariff stands at 396%, Thailand’s at 375%, and Malaysia’s at 34%.
In terms of import data, the United States relies heavily on Southeast Asian solar products. According to BloombergNEF, the United States imported $12.9 billion worth of solar equipment from these four countries last year, accounting for nearly 80% of total imports in this category.
The imposition of these high tariffs is expected to effectively shield U.S. domestic manufacturers from low-priced competition from Southeast Asia, creating a more favorable environment for their development in the domestic market. However, for the overall development of the U.S. solar industry, this move may also bring about a series of challenges.
