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Subject

The outlook for the solar photovoltaic sector in China.

Significance

The EU's decision last month to remove tariffs on imported Chinese solar panels follows a US move to increase tariffs. It also comes at a time when international prices for panels are falling in response to a reduction of subsides for the deployment of solar photovoltaic (PV) capacity in China.

Impacts

Falling prices will stimulate further installation of solar PV capacity across the world, especially in sunny regions.

Chinese manufacturers will further expand their capacity both at home and abroad.

Non-Chinese PV manufacturers will find their profits squeezed even further unless they are protected by import controls.

The rate of deployment of new solar PV capacity within China will decline, but still remain substantial.

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