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A phone call decides the success of China-EU PV negotiations
The recent resolution of the China-EU photovoltaic (PV) trade dispute marks a significant milestone in bilateral relations. Following a "price commitment" agreement with China, several Chinese PV companies will now be exempt from high anti-dumping duties. On August 3, the European Commission officially announced its acceptance of this arrangement, signaling a breakthrough in what was previously one of the largest trade conflicts between the two sides. The Chinese Ministry of Commerce welcomed the decision, highlighting that the issue—once a major source of tension—has been temporarily resolved through negotiation.
Many analysts credit Premier Li Keqiang for playing a key role in the successful outcome. As one expert noted, “If I didn’t call the prime minister, I’m afraid it’s still hanging.†Researcher Bai Mingnan from the Ministry of Commerce’s International Trade and Economic Cooperation Research Institute pointed out that such high-level involvement in specific product negotiations is rare. Before the Sino-European talks, discussions on individual products rarely reached the level of the Prime Minister.
This level of engagement was not accidental. During his visit to Switzerland in May, Premier Li emphasized the importance of resolving disputes through negotiation, opposing trade protectionism, and safeguarding national business interests. These principles were later echoed during his visit to Germany, where he criticized trade protectionist practices as harmful and advocated for dialogue-based solutions.
In a meeting with EU officials in June, Li warned that unresolved issues could lead to a trade war, which would harm both sides. He stressed the need for cooperation and said that if the EU persisted in imposing sanctions, China would have no choice but to respond.
Experts like Mao Chunchun, director of the Tsinghua University Economic Research Center, acknowledged the impact of the Prime Minister’s direct intervention. “His calls have a great effect. If Li Keqiang hadn’t called, it might have been suspended.â€
So why did the PV industry require such high-level attention? The answer lies in the scale and significance of the dispute. In 2011 alone, China exported over $35.8 billion in PV products, with the EU accounting for 60% of that. The double-countervailing cases were among the largest trade conflicts globally, affecting thousands of jobs on both sides.
According to Bai Mingnan, such disputes often go beyond technical negotiations and require a broader diplomatic approach. “Placing the issue within the context of bilateral relations helps both sides see the bigger picture,†he explained. “It allows for a more balanced and sustainable solution.â€
While the EU has agreed to the price commitment, it continues its anti-subsidy investigations into Chinese PV products, with final results expected by year-end. Despite this, the current agreement represents a positive step forward, demonstrating the power of high-level diplomacy in resolving complex trade issues.