U.S. and China sign Phase 1 trade agreement

U.S. and China sign Phase 1 trade agreement

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China and the United States have signed a Phase 1 trade deal that signals a rollback in the back-and-forth tariffs between the countries, according to the U.S. Chamber of Commerce. Solar inverters are part of the $200 billion of Chinese imported goods tariffed at 10% that started in September 2018. Trump threatened to raise those tariffs by 25% at the start of 2020, but held off due to the start of negotiations with China. Solar Power World cannot yet confirm if now Chinese inverters are excluded from being taxed. Solar panel tariffs are global and separate from the 10% Chinese tariffs.

“We commend both governments for staying the course and taking this important step to rebuild trust and restore some stability in the world’s most important commercial relationship,” said U.S. Chamber CEO Thomas J. Donohue. “This deal provides much needed certainty to American businesses as they begin the new year.”

CNBC reports the deal includes a commitment by China to buy more U.S. agricultural products and a promise by the United States to cancel or reduce some tariffs.

“This agreement signifies a new chapter in U.S.-China relations. When fully implemented, China’s commitments will create a better environment for U.S. exporters and investors and begin the process of rebalancing the economic relationship between the United States and China,” said Donohue. “We hope this deal will usher in a new era of trust between both countries and pave the way for Phase 2 negotiations to begin in a timely manner.”

SEIA released a statement applauding the agreement and its affect on U.S. polysilicon manufacturers. REC Silicon manufactures polysilicon, the main component in solar cells, in the United States but had to shut its $1.7 billion plant in Washington State after China shut out U.S. imports. Polysilicon is one of the materials that China will now buy more of from U.S. suppliers.

“While this trade deal won’t do anything to relax the solar tariffs, it is a positive development for the U.S. solar industry,” said John Smirnow, VP of market strategy at SEIA. “Polysilicon is the building block of most solar cells on the market and these changes are a great development for American manufacturers who have been hit hard with Chinese duties on their products. Credit to the Trump Administration for cutting a deal that gives relief to U.S. polysilicon production companies. We hope this deal will start a much-needed discussion with the administration about how we can scale back the tariffs on solar products more broadly, while continuing to build American solar manufacturing.”

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