The high-stakes game of managing relations between the world’s major economies has taken another turn – and one that underlines the dangers of using clumsy trade policies to intervene in ever more complex global industries.
Visiting China last week, Angela Merkel, the German chancellor, said that a trade dispute over solar panels would be better dealt with by negotiation than by imposing antidumping duties on low-priced imports from China. EU solar manufacturers – dominated, as it happens, by SolarWorld, a German-headquartered company – filed a petition to the European Commission last month, following a successful similar action led by SolarWorld in the US earlier this year.
Ms Merkel’s intervention is unlikely to be decisive at this stage. The EU’s trade directorate is due to make its initial report on the petition in just over a week and the indications are that it will find enough evidence to proceed to the next stage of investigation.