The European Commission has alleged China offered cut-price finance to Indonesia, via Beijing’s Belt and Road drive, so Jakarta could develop domestic demand for stainless steel raw material nickel ore.
With solar panel prices having been forced up last year by a shortage of input material polysilicon, and amid predictions the ethylene vinyl acetate used to encapsulate solar cells will be another supply chain bottleneck, the EU has imposed fresh trade duties on imports of steel products from India and Indonesia.
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The stainless steel, cold-rolled flat products affected – described as “essential for … energy equipment” by the European Commission on Wednesday – will suffer anti-subsidy duties of 21%, for Indonesian goods, and 7.5% for supplies from India.
Those levies will come on top of anti-dumping duties of 13.9-35.3%, for Indian products, and 10.2-20.2% for their Indonesian equivalents, applied by the European Union since November.
The European Commission said it was taking action against cross-subsidization of the industry by China.
The EU executive said, when Indonesia decided it wanted to create domestic demand for the nickel ore it produces in large quantities – rather than simply exporting the stainless steel raw material – it needed cheap Chinese finance, provided under the latter’s continent-spanning, One Belt, One Road infrastructure drive.
In return for cheap credit, the commission said, China received bargain price nickel ore which resulted in a double whammy for European steelmakers faced with cheap Chinese imports and lack of access to Indonesian nickel ore thanks to export restrictions imposed in the latter country.