File Photo: Workers at a solar panel factory in Ariz. U.S. Sept., 2012 (By Associated Press)
TAIPEI (Taiwan News) – On Tuesday Jan. 30, a filing at the World Trade Organization’s headquarters in Geneva, Switzerland, showed that Taiwan had joined South Korea in lodging an official complaint with the United States over recent import tariffs introduced by the Trump administration on solar panels.
The report from Reuters says that Taiwan, as the second largest solar cell manufacturer after China, will suffer under the 30 percent tariff on solar panels.
The Trump administration made the decision in an effort to supposedly grow the domestic market, while protecting the U.S. market from being flooded by cheaper goods produced abroad (mainly in Asia).
The move has been met with both arguments against and in favor.
According to the report, WTO regulations stipulate that if one country introduces sudden regulatory practices that will significantly and adversely affect one trading partner, they must offer compensatory deals on other products/sectors to make up for the losses incurred.
If they fail to do so, the country filing the complaint may enact trade sanctions and barriers targeting the offending country, but not within a three year period stipulated by the WTO Agreement on Safeguards.
In this case it means the United States has three years to fully insulate and grow its domestic solar panel market, before Taiwan will be legally justified to enact any stiff trade sanctions.
After the filing seeking compensatory measures from the United States, a 30 day period for negotiations will begin.
According to a brief from Stratfor, the U.S. will be expected to let“Taiwan impose restrictions of equal value on U.S. exports. " However, it is also possible the two countries may agree to other forms of settlement.
The reported filing of the WTO complaint in Geneva was made the day after three of Taiwan’s major solar energy companies announced a merger to create a globally competitive Taiwanese “solar flagship company.” The new company will be called United Renewable Energy Co Ltd. and is reportedly already planning to build a module solar cell factory within the U.S.