More heat than light? Renewable energy policy and EU–China solar energy relations

Abstract

ABSTRACTThis paper explores recent developments in EU–China relations in the renewable energy sector, in the context of several recent high-profile trade conflicts. Our key findings are that both trade and investment from China into the EU increased markedly in the years up to 2011, but have fallen since then, most notably for trade. While trade tensions explain some of this fall, it seems more related to fundamental changes in the EU market and a rising realisation that China’s domestic market is key to the sector’s long-term development. The destination and source of Chinese investments in the EU are highly concentrated, with Germany the destination for half of investments and two Chinese provinces –Jiangsu and Zhejiang – making up 65% of the source of funds. Most of the companies investing are small, commercially oriented enterprises, indicating that market-seeking is their key objective, with strategic assets apparently less important.