EU solar deal hailed as blueprint

Cui Hongjian, director of European studies at the China Institute of International Studies, said, "We can say it's a new attempt at solving trade disputes through the involvement of high-level officials."

Duncan Freeman, senior researcher of Brussels Institute of Contemporary Chinese Studies, agreed. "I am impressed that Premier Li is diplomatically active and forceful in approaching the problems and that he is solution-oriented," he said.

The solar panel case is the largest trade investigation that the European Commission has undertaken. In 2011, the EU's imports of solar goods from China were valued at 21 billion euros ($27.9 billion).

China's solar panel exports rely heavily on the European market, with 80 percent of the nation's exports going to Europe. More than 1,000 industrial companies and 400,000 jobs are in the sector.

While he sought consultations with top EU officials, Li also encouraged the domestic industrial players to invest in innovation and strive to create a business-friendly environment back home.

In a visit to Hebei province in June, he chose to tour Jinglong Co, a photovoltaic company in Xingtai, when he called for Chinese companies to strengthen innovation and the domestic market while stabilizing the overseas markets.

In mid-July, the State Council launched detailed guidelines to promote domestic consumption of PV products and facilitate sustainable development of the industry.

The final settlement of the solar dispute with the EU prevented the outbreak of a trade war, and it also provides a "new model" for solving trade disputes.

"The solutions from Brussels are welcomed and appreciated, and both sides have set an example for dealing with disputes," said Chi Fulin, president of the China Institute for Reform and Development, a think tank.

Europe is China's largest trading partner, while for the EU, China is second only to the United States. Chinese statistics showed that bilateral trade reached $546 billion last year.

"Trade friction is unavoidable between China and the EU, but the key is how to solve it, and the solar panel case is a good example to follow," Chen said.

While China maintains the world's second-largest economy and pledges to expand domestic consumption, the debt-ridden EU does not want to lose out in the Chinese market, experts said.

"China and the EU are very reliant on each other, and economic cooperation will deepen in the future," Chen said.

"China is an important market for the EU, especially given the nation's commitment to expanding consumption."

Contact the writers at dingqingfen@chinadaily.com.cn

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