China plays down US trade row over solar products

China Wednesday sought to defuse a trade row with the United States after the latter imposed duties on Chinese solar products, saying it would not hurt ties, even as state media cried protectionism. The United States said Tuesday it would collect duties of between 2.9 and 4.7 percent on Chinese solar cells and panels, in a preliminary ruling after an investigation over whether companies received unfair financial support. US companies have accused China of improperly subsidising its solar sector as part of a no-holds-barred commercial battle for supremacy of the lucrative market. "It is normal for the two sides to have friction and differences of views," Chinese foreign ministry spokesman Hong Lei told a regular news briefing in Beijing. "We should not allow such friction to impair the sound development of Sino-US economic relations," he said, calling for negotiations to help resolve trade disputes. China had expected duties of up to 10 percent, state media said. Shares of some Chinese solar companies rose in domestic trading Wednesday given the less-than-expected duties, brokers said. A commentary issued by the official Xinhua news agency called the US duties lighter than expected but it still warned Washington against resorting to protectionism. "Although the solar panel case has proven to be less devastating than expected, the U.S. government recently intensified shots against a range of Chinese imports... recalling the phantom of protectionism," it said. "Punitive duties, big or small, will distort normal trade relations and risk disturbing the fragile global economic recovery process." Chinese producers denied the US findings and accused Washington of erecting obstacles to trade. Suntech, the world's largest solar panel producer, said its success was based on "free and fair" competition. "Unilateral trade barriers, large or small, will further delay our transition away from fossil fuels," Chief Commercial Officer for Suntech Andrew Beebe said in a statement. Another Chinese company, Yingli Solar, defended its business practices. "We are not dumping, nor do we believe that we are unfairly subsidised," Robert Petrina, managing director of Yingli's US subsidiary, said in a statement. The US Department of Commerce is due to announce more findings in May for a parallel investigation into whether Chinese makers are dumping -- or predatory pricing -- underpriced solar cells into the United States. Chinese solar-related shares were mixed in Shanghai trading Wednesday. Solar cell component maker Tianwei Baobian Electric slid 0.92 percent but TDG Holding jumped 2.10 percent. The US moves come as Washington steps up efforts to protect domestic manufacturers from Chinese products that it also alleges benefit from an artificially undervalued currency. Last month, US President Barack Obama took direct aim at China when he ordered the creation of the Interagency Trade Enforcement Center to expedite unfair trade complaints from US business.