Labor & Employment Law

Clean Energy Trade Deficit with China: 8,000 Jobs Lost this Year

By James Parks

The U.S. trade deficit with China in clean energy products more than doubled in the past two years alone and will cost more than 8,000 U.S. jobs in 2010. The Economic Policy Institute (EPI) analyzed trade data through August 2010 and found that the trade deficit with China soared at a time when the overall U.S. trade deficit and the U.S. clean energy deficit with other countries both fell sharply.  

The findings support the charges in the United Steelworkers? (USW) petition under Section 301 of the trade law claiming China?s government has used hundreds of billions of dollars in subsidies, performance requirements, preferential practices and other trade-illegal activities to dominate the renewable energy market.

Robert Scott, EPI?s senior international economist, says:

The Obama administration?s decision to investigate China?s trade practices in the green technology sector is an important first step toward reducing the U.S. trade deficit and creating jobs. China has captured market share through massive subsidies and unfair trade practices which, if allowed to continue, will cause continued increases in the trade deficit and harm to U.S. manufacturers and workers.

The petition shows that China is using a wide array of illegal trade policies including massive subsidies, restrictions on access to rare earth elements and other minerals, discrimination against foreign firms or goods, technology transfer requirements for foreign investors and making subsidies contingent on exports or domestic content. Check out the EPI analysis here.

With such a growing deficit in green products, China threatens to replace all other countries in the world as the most important supplier to the United States of these products.  The Chinese government?s unfair trade policies are also injuring exporters of environmental products from around the world. Scott adds: 

It is time for China to end illegal export subsidies and all other illegal efforts to establish its environmental product producers as leading export industries. 

Full post as published by AFL-CIO NOW BLOG on October 20, 2010 (boomark / email).