his election campaign claimed that China gave itself special advantage by
devaluing its currency and reaping the benefits in global market. Trump had
promised to punish China by imposing tariff duties on imports as high as 45% to
protect the local American producers from competition. With more than one year
lapsed, Trump being elected as the President, was feeling the pressure to
deliver on his campaign promises. Donald Trump on 22nd January, 2018
finally delivered on his biggest campaign promise of standing up against China
for its “unfair” trade practices.
imposed an import duty of 30% on all solar equipment imports in the first year,
which will be reduced to half, 15% by the fourth year. However, 2.5 gigawatts
(GW) power of solar panel per year can be imported in the U.S. without any
import duty fees. Exemption of 2.5 GW power of solar panel means 11.5 million
panels can be imported without attracting any import duties. Currently, U.S.’s $28
billion industry of solar panel, 80% of solar panels are imported. Further,
U.S. has also imposed a 20% import duty on 1.2 million washing machines
imported and 50% on any further washing machines imported. This percentage
changes to 16% and 40% respectively in the third year. This move is mainly
indicated to make imports of these electronic equipment from China seem less
attractive as China is the largest exporter of these electronics to the U.S.
This move will have a serious effect on China solar panel business as it is the
leads the world in export of solar panels.
though Trump aims at helping the local business in solar panel, his move to
impose import tariff will sincerely affect the employment of as high as 23,000 of
total 2,60,000 in the solar panel assembly sector, as projected by Solar Energy
Industries Association. Further, the solar panel installations are expected to
reduce to 9 GW from current 11GW market in the U.S.. Research also suggests to expect
decline in the growth rate of U.S. solar installation by 10% to 15%. Trump’s
move has been looked down upon by the environmentalists as it increases the
dependence of U.S. on non-renewable sources of energy like coal which also takes
care of nation’s power needs. This move also helps to save the failing coal
production sector – which was also one of the campaign promises of Trump. Also,
U.S. pulling out from Paris Climate deal combined with imposition of tariff, is
clear enough to assume that Trump is not taking the threat from global warming.