The European Union (EU) recently accused China of harming the EU Solar Panel Industry by dumping. The EU is responding by using anti-dumping tariffs to deal with the situation and to stop any further harmful effects on their industry. Could this all lead to trade war?
Watch the video below to build a further understanding of the situation. Afterwards answer the following questions:
1) What are the harmful effects of Chinese dumping on the EU solar panel market?
2) The European Union is therefore, using a tariff to “restore trade balances”. Draw a international trade diagram to demonstrate how this will impact the European market for solar panels.
3) What were the results of the EU investigation? How is it that China was able to dump on other markets? What led them to have prices that would be considered below the cost of production? For answers to these questions read the following article.
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