Chinese-owned solar companies in Southeast Asia, including Thailand, Vietnam, Malaysia, and Cambodia, are encountering potential challenges due to increasing US tariffs. These countries represent 40% of solar module production capacity outside of China and may face additional tariffs amid accusations of assisting China in bypassing US import duties.
Currently, many Chinese firms are downsizing their operations in Southeast Asia, affecting the European Union’s plans to expand its solar capacity. Despite Southeast Asia being second only to China in solar panel production, over 80% of US solar imports by the end of 2023 came from the region.
In June 2024, major Chinese-owned solar panel producers reacted immediately to the expiration of a two-year tariff reprieve ordered by the Biden administration. Some have shifted production to Indonesia and Laos to avoid US tariffs. However, concerns about the industry’s future remain high, with ongoing investigations into government subsidies and product dumping.
While the EU has imposed tariffs on Chinese solar imports, it has been lenient with imports from Southeast Asia. Analysts predict that Chinese solar producers will continue to operate in Southeast Asia despite higher US tariffs due to the potential profitability of the American market.
