China rejects clean energy probe, calls US unfair

Last Updated: Sunday, October 17, 2010 - 23:54

Beijing: A senior Chinese official rejected a US trade complaint about Beijing`s clean energy policy and said today that Washington might be improperly supporting its own industry.

The US government said Friday it would investigate complaints by a labor union that Beijing unfairly subsidises its producers of wind and solar equipment. "Chinese subsidies to new energy companies are much smaller than those of the US government," said Zhang Guobao, director of the Cabinet`s National Energy Administration, at a
news conference. "If the US government can subsidise companies, then why can`t we?"
The complaint by the United Steelworkers adds to strains between Washington and Beijing over trade in tires, steel, chicken, movies and other goods. It says Chinese
producers can sell wind and solar equipment at lower prices abroad because they get subsidies that are prohibited by global trade rules.

Zhang countered that Washington might be improperly supporting its own industry. He cited what he said were rules on spending of US government money for solar energy that
require equipment to be domestically made.

"If what I said is right, it is the United States that should be sued, not us," he said.
The unusually prompt, high-level Chinese response reflects Beijing`s growing confidence in rejecting US pressure over trade and other issues, as well as its determination to develop high-tech industry.

The communist government is aggressively promoting wind, solar and other renewable energy to curb surging demand for imported oil and gas. It is trying to build up Chinese
equipment suppliers to capture the economic benefits of a fast-growing industry.

In a statement yesterday, the Commerce Ministry said Washington`s complaint signals the US does not support China`s efforts at improving the environment. Zhang said 50 per cent of clean energy equipment installed in China last year was imported and suppliers such as General Electric Co have made substantial sales.

"Once we reveal these facts to the world, the (US) complaint will be shown to be groundless, and all the American subsidies will be exposed," he said. If the US investigation finds the union complaint true, the Obama administration could sue China in the World Trade Organisation.

A favourable WTO ruling would allow Washington to impose penalties on Chinese imports unless Beijing repealed any support deemed to be improper.

Bureau Report

First Published: Sunday, October 17, 2010 - 23:54

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