China and the European Union have reached an agreement over low-cost solar panels that should help reduce tensions between the key trading partners.
The deal, reached after weeks of negotiations, will allow Chinese solar panel producers to export their goods to Europe, provided they offer the products above a minimum price. Chinese companies that agree to the terms will avoid the severe tariffs that had been implemented by the E.U.
The deal is not likely to please all parties. While the European Commission has not announced the full terms, media reports indicate that the minimum price for Chinese panels has been set at 74 U.S. cents per watt -- a much lower price than had been sought by European manufacturers.
Karel De Gucht, the E.U. trade chief, is bound to face questions from producers over the price minimum. He must also move to patch up fissures between E.U. member countries -- some of which had publicly questioned the wisdom of taking China to task over solar panels.
The agreement still needs approval from the European Commission.
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