Chinese PV firms face uncertainties

SHIJIAZHUANG -- The European Commission will soon decide whether to start an investigation into Chinese photovoltaic companies after some European solar enterprises filed an anti-dumping complaint in July.

In the face of the current global economic woes, most of the Chinese PV companies have suspended production this year. On July 24, Germany's SolarWorld and some European enterprises filed an anti-dumping complaint with the European Commission.

Some industry insiders believe that once the EU accepts the complaints, and decides to initiate an investigation, a large number of Chinese PV companies will face the risk of bankruptcy, while the whole industry, as well as economy and the society will be seriously affected.

Worries and risks

Zeng Shaojun, secretary general of China New Energy Chamber of Commerce under All-China Federation of Industry and Commerce said the investigation will include all homemade PV products, totaling nearly 1,000 billion yuan ($158 billion), which equates to the volume of imported vehicles from Europe to China in 2011.

Therefore,if the EU rules whether dumping behaviors exist and begin to raise tariffs, the trade, policy, economy and society of both China and European countries will be affected, Zeng added.

In addition, China's solar product exports were valued at $35.8 billion in 2011, with the EU receiving a share of more than 60 percent, reaching $20.4 billion.

If an investigation begins, this will be the largest trade dispute involving China in terms of trade volume.

Miao Liansheng, chairman of the board of Yingli Green Energy, one of the most advanced solar PV enterprises in the world, said if the anti-dumping case is verified, Chinese PV companies will be forced to transfer their industry to other countries, which will cause a loss to the real economy in China, and this newly leading industry will also lose its development opportunities.

Some enterprises in Hebei, Jiangsu and Jiangxi have started to explore new markets in Japan, Republic of Korea, Africa, South America and Southeast Asia.

To encourage the development of the industry, Chinese governments and banks have issued some preferential policies for the companies, such as issuing credits to build up plants and expand production.

If the companies shut down, the equipment and plants will depreciate, so the huge loan cannot be redeemed, and the stability of economy and society will also be affected. And the Chinese PV industry will face a devastating blow, said an official of Yingli, who refused to give the name.

Millions of unemployment

Statistics show that China has more than 300,000 practitioners directly working for the PV industry. Adding other relevant enterprises, the number of workers involved in this industry reaches more than one million.

Liu Hanyuan, another senior official of CNECC, said that the case may force 80 percent of workers to lose their jobs or retain their roles but have their salary suspended.

"If the situation goes bad, we will allow some of the staff to have paid vacation, but we will consider job cuts if it gets worse," said Ji Youqiang, an official of Lightway Solar, located in north China's Hebei Province with more than 1,800 workers.