Although German Chancellor Angela Merkel promised last week that she would encourage EU solar panel producers to refrain from using protectionist measures against Chinese imports, the EU announced a decision Thursday that may embarrass Merkel.
The European Commission said it will probe the possible dumping of solar panels by Chinese producers, marking the biggest such complaint filed by the EU in terms of import value.
Last week also saw the signing of a multi-billion-dollar airplane order between China and the EU, as well as other deals between China and its partners in Europe.
However, Merkel's constructive approach and the signing of these deals seem to have been overshadowed by the EU probe, and China's goodwill only meets with contrasting and disappointing response.
China has said that its low-cost products are a result of cheap labor and the scale effect, rather than the waging of a price war or government subsidies.
There is no scant of example of trade remedy probe good for no one. After the U.S. government launched a similar case against China's solar panel products this year, China announced an anti-dumping probe against U.S. polysilicon, the primary material for solar panel.
It is unwise for the EU to discount both China's opinion and industry precedent. Its probe is a result of the narrow consideration of the interests of just a few European industry group.
As each other's largest trading partners, China and the EU have scored significant achievements and have significant opportunities for future cooperation. Recent Chinese investment in a slew of EU infrastructure projects offers a classic example of how both sides can achieve win-win results through cooperation.
As the EU grapples with the worst financial crisis in decades, a more constructive and rational approach to trade should be employed. China is waiting for a constructive answer from the EU, and it should not come too late.
