China says wind, solar subsidies WTO compliant
China is defending its subsidies for wind and solar power against a U.S. complaint to the World Trade Organization that such support is unfair, but says it will work to resolve the dispute.
The relatively mild response Thursday to the U.S. move likely reflects Beijing's desire to keep relations on a positive track in the weeks leading up to Chinese President Hu Jintao's state visit to the U.S., which begins Jan. 19.
"Every country in the world is seeking to develop renewable energy to cope with climate change. China's wind power measures are helping save energy and protect the environment," the Commerce Ministry said in a statement.
"This is crucial for sustainable development and is in accord with WTO principles," it said.
The ministry said China attaches "great importance" to WTO dispute settlement procedures and would reserve its "due rights."
The case filed against China at the Geneva-based WTO on Wednesday accuses Beijing of giving unfair government subsidies to Chinese energy companies. News of the case came on the same day the White House announced Hu's visit.
The two countries are at odds over a slew of issues. Beijing was outraged earlier this year by a major U.S. arms sale to Taiwan, while Washington has been upfront about its desire to see Beijing do more to rein its longtime ally North Korea.
The U.S. side has persisted, meanwhile, in pushing for faster changes in currency policies that it contends keeps the Chinese yuan undervalued, swelling the chronic U.S. trade deficit with China.
The WTO case was in response to a United Steelworkers petition last September that alleged Chinese companies can sell wind and solar equipment on international markets at cheaper prices than their competitors because they receive subsidies.
The administration's WTO case alleges that those subsidies violate global trade rules.
U.S. Trade Representative Ron Kirk said the type of subsidies the Chinese government had employed were "particularly harmful and inherently trade distorting."
The case will first trigger consultations between the two nations. If they fail to resolve the dispute, the WTO will convene a hearing panel.
If the administration wins the case and China does not give up its subsidies, the United States would be authorized to impose penalty tariffs on Chinese products equal to the lost sales that U.S. energy companies are experiencing.