BRUSSELS/BEIJING — China's leadership transition is complicating talks to resolve a multi-billion-dollar dispute with the European Union over solar panels, pushing both sides closer to placing punitive tariffs on each others' exports and risking a trade war. The newly appointed chief of China's Communist Party Xi Jinping is set to take over the presidency at a national congress in March. But the full line-up of government officials is not yet in place and China's current commerce minister is likely to step down after what some have said was a political snub at the Party's congress in November. EU leaders want to avoid following the United States' decision last year to impose duties on Chinese solar power products, aware that Europe needs China to help it emerge from three years of economic crisis. But EU officials and diplomats say they have made little progress, accusing the Chinese of "stonewalling", and are unable to get beyond the outgoing commerce minister, Chen Deming. They complain of a limbo in the ministry that will not end until after the March congress. "There is no clarity on what the new leadership thinks about trade," said a senior EU official involved in talks with China. "They are stonewalling and the window of opportunity for a solution on solar panels is closing." China's commerce ministry spokesman Shen Danyang told reporters in Beijing this week that officials are "conducting consultations and relevant response work with the concerned parties," but did not comment on any impact China's leadership transition is having on negotiations. Germany, the United States and China are the world's biggest solar markets and companies are in a race to win contracts as countries seek to limit pollution and global warming. European solar panel manufacturers, led by Germany's Solar World, accuse their Chinese counterparts of receiving state subsidies to flood the EU with panels sold below cost and putting Europeans out of business to corner the market. The European Commission, the EU executive, launched an investigation last September into Chinese solar panels, the biggest import sector it has ever targeted. China exported more than $25 billion worth of panels to the European Union in 2011. Highlighting the risk of a trade war, Chinese solar companies also accuse the European Union of wrongdoing. — Reuters
