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The amicable solution to a dispute between the European Union (EU) and China over solar panels has prevented a full-scale showdown between the two major trade partners and provided a chance for both sides to review their policies on related industries.
For China's photovoltaic (PV) industry, as some experts have already pointed out, a lack of technical innovation, improper planning, misreading of market trends, and blind expansions are among the problems that demand urgent attention and quick solution.
Since China's PV sector heavily relies on foreign countries' subsidy policies to maintain a high profit margin, it is vulnerable to external changes.
Therefore, upgrade and adjustment is badly needed for the industry to enhance its core competitiveness via technological improvement.
On the world stage, major countries are keen to develop low-carbon economies via clean energy in the post-financial crisis period. Without a proper settlement to the China-EU solar panel dispute, both sides would have suffered trade and industry losses and the hard-won cooperative momentum on clean energy between the two sides would also have been set back.
The development of clean energy in the EU was affected by the bloc's debt crisis, with some EU members ending subsidies to PV and other related industries.
This explains why the solar panel dispute started in the first place. Some industries and people in the EU may have thought that, by imposing extremely high tariffs on Chinese solar panels, the pressure could be passed on to China.
However, such a tactic won't benefit the EU.
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