Trump hits solar panels, washing machines with tariffs

2018-01-23 10:16
Solar panels produce energy from the sun. (Duncan Alfreds, News24, file)

Solar panels produce energy from the sun. (Duncan Alfreds, News24, file)

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Washington - US President Donald Trump on Monday approved tariffs on imported solar-energy components and large washing machines in a bid to help US manufacturers.

The president's decision followed recommendations for tariffs by the US International Trade Commission.

"The president's action makes clear again that the Trump administration will always defend American workers, farmers, ranchers, and businesses in this regard," US Trade Representative Robert Lighthizer said in a statement announcing the decision.

Most imported solar modules will face an immediate tariff of 30%, with the rate declining before phasing out after four years.

For large residential washing machines, tariffs will start at up to 50% and phase out after three years.

The US solar industry was split over the trade barriers.

Cheap products

The tariffs were sought in 2017 by Suniva, which filed for bankruptcy protection in April, and the US subsidiary of Germany's SolarWorld.

They said that a nearly 500% increase in imported solar panels over five years led to a ruinous price collapse.

Nearly 30 US solar-manufacturing facilities had closed in the past five years, they said, as China plotted to flood the global market with cheap products to weaken US manufacturing.

Suniva spokesperson Mark Paustenbach called tariffs "a step forward for this high-tech solar-manufacturing industry we pioneered right here in America".

However, solar installers and manufacturers of other equipment used to run solar-power systems opposed tariffs, which they said will raise their prices and hurt demand for the renewable energy.

The Solar Energy Industries Association, which represents installation companies, said billions of dollars of solar investment will be delayed or cancelled, leading to the loss of 23 000 jobs this year.

Mark Bortman, founder of Exact Solar in Philadelphia, said the prospect of tariffs - since the trade commission recommended them in October - had already caused him to delay hiring and expansion plans.

"Solar is really just starting to take off because it is truly a win-win-win situation" for consumers, workers and the environment, he said. "Tariffs would really be shooting ourselves in the foot."

The case for tariffs on washing machines was pushed by Benton Harbor, Michigan-based Whirlpool Corporation. The company's chair, Jeff Fettig, said tariffs on imported machines would create new manufacturing jobs in Ohio, Kentucky, South Carolina and Tennessee.

"This is a victory for American workers and consumers alike," Fettig said. "By enforcing our existing trade laws, President Trump has ensured American workers will compete on a level playing field with their foreign counterparts."

Trade protection

But Senator Ben Sasse, (Republican from Nebraska) said Republicans need to understand that tariffs are a tax on consumers.

"Moms and dads shopping on a budget for a new washing machine will pay for this - not big companies," Sasse said in a statement.

Suniva, SolarWorld and Whirlpool were helped by a 1974 trade law that lets companies seek trade protection if they can show damage from a rise in imports.

Up to certain levels, imports of solar cells will be exempt from the tariff, while the first 1.2 million imported large washing machines will get a lower tariff, peaking at 20%.

Congress has no authority to change or veto Trump's decision. Countries affected by the decision can appeal to the World Trade Organisation.

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