It appears that current sanctions imposed by the United States against Chinese imports has not dampened the enthusiasm of one of the world’s leading solar panel makers over the impending construction of a third factory in Vietnam.
China’s Trina Solar is slated to invest a total of $400 million in a production facility that will cover a 25-hectare industrial estate. According to insiders, this decision is expected to increase Trina’s export of solar panels and related equipment to the US, essentially circumventing additional duties levied on its products which are currently being manufactured in Thailand.
This foray into Vietnam was also spurred on by a recently concluded investigation on the part of the US Department of Commerce which determined that Trina Solar and four other Chinese solar manufacturers took the bulk of their production to Thailand and other locations within Southeast Asia.
Those Chinese firms did this to avoid tariffs imposed by the US government against panels and other solar equipment produced in China as their manufacturers have taken advantage of several state subsidies.
While the American tariffs won’t come into play until mid-2024, Chinese manufacturers setting up shop for solar equipment production within Southeast Asia remain under the gimlet eye of US authorities. That said, China is now the second-largest source of foreign investments into Vietnam, having infused a total of around $2.7 billion into the country’s manufacturing sector as of August 2023, over five times the total amount of investment made by its American counterparts.
Also, while the tariffs will only affect Trina Solar’s operations in Thailand, the company has nevertheless selected Vietnam as its alternative location for manufacturing within the region. Indeed, insiders claim that the company has already set aside around $600 million in potential investments for its Vietnamese initiatives.