What is the effect of Tariff imposed by the US to Chinese solar panels Essay

What is the effect of Tariff imposed by the US to Chinese solar panels manufacture industries and on US producers - Essay Example Since the World Trade Organization provides for a free trade among its member states, such a move to impose tariffs on Chinese solar panels may not only infringe WTO trade agreement, but also bring disagreements that jeopardize the good trade relations that the country has had with China (Goldenberg, 2012). To better the situation for the American manufacturers, the commerce depart promised to enforce tariffs of 2.9 percent to 4.73 percent. This was after it was established that the Beijing government was offering unlawful grants to the Solar panel makers (Goldenberg, 2012). Some of the manufacturers acknowledged receiving government support and other cheap loans from the government. Though the imposition of the tariffs aims at leveling the unfair competition by Chinese manufacturers, some of the American based solar installation companies that rely on Chinese solar panels articulated their respite that the minimal tariffs imposed would not cause an increment in prices (Goldenberg, 2012). During his campaign trail, Obama indicated that renewable energy has for long been America’s innovation since solar power was first discovered at Bell Labs. Most of the countries have made efforts to promote clean energy sources to save the environment and reduce the effects of global warming (Goldenberg, 2012). The energy secretary noted that United States had overthrown China in clean energy investment by far. However, this growth in America’s clean energy was brought about by the low costs of Chinese solar panels. The increased demand for Chinese made solar panels has increased the United States solar panel imports from Chinese. This in turn resulted to the death of home grown solar manufacturing companies such as Solyndra and Evergreen Solar companies. This has resulted to embarrassment of Obama’s administration. Imposition of tariffs on the Chinese-made solar panels can assist the growth of the domestic solar panel manufacturers. Unfair competition, as noted