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Brussels has launched a subsidy investigation into Chinese wind turbine companies as it steps up efforts to protect its domestic industry from cheap competition.
Margrethe Vestager, the EU’s top competition enforcer, said the probe would examine whether Chinese companies participating in wind parks across Europe may have benefited from state support from Beijing.
The investigation will use the European Commission’s new powers designed to clamp down on market-distorting subsidies from foreign governments as Brussels seeks to defend itself from unfair competition from abroad, including Beijing.
Investigators will examine “the conditions for the development of wind parks in Spain, Greece, France, Romania and Bulgaria”, Vestager said.
The probe comes days after the commission launched investigations into two consortiums bidding for the development of a solar park in Romania, which include Chinese solar panel manufacturers.
In February the commission launched a similar probe into Chinese state-owned company CRRC’s bid to supply trains in Bulgaria, which was half the price of a European competitor. CRRC later withdrew from the process.
In a speech at Princeton University, Vestager said Brussels should move away from playing “whack-a-mole” with individual cases and instead use its full powers to defend its interest against unfair trade practices by China.
“We saw the playbook for how China came to dominate the solar panel industry,” she said. “First, attracting foreign investment into its large domestic market, usually requiring joint ventures.”
“Second, acquiring the technology, and not always above board,” she added. “Third, granting massive subsidies for domestic suppliers, while simultaneously and progressively closing the domestic market to foreign businesses. And fourth, exporting excess capacity to the rest of the world at low prices.”
Vestager said that as a result, less than 3 per cent of the solar panels installed in the EU were produced in the continent. Several manufacturing plants have closed in recent months, saying they cannot compete with Chinese imports.
China’s exports of green technology have ballooned in recent months as it opens factories. A surge in imports of electric vehicles prompted the commission to open an anti-subsidy investigation last year, which should conclude in July and could lead to tariffs.
Chinese officials claim their products are simply better.
Peng Gang, minister for economic and trade affairs at the Chinese embassy in Brussels, wrote on Monday that EU-China collaboration was a “win-win”.
He noted that some in Europe had attributed the success of Chinese companies to subsidies — while the EU was at the same time offering large subsidies to companies that were struggling to be competitive.
“The secrets behind Chinese products going global have never been the so-called subsidies, but diligence, innovation and competitive awareness of generations of Chinese entrepreneurs,” he said.
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