US slaps steep tariffs on Southeast Asian solar imports

The U.S. broadened its trade dispute with China by imposing steep tariffs on solar imports from four Southeast Asian countries where mainland manufacturers have set up factories in recent years.

Tariffs of up to 3,521% on imports of solar cells from Cambodia, Thailand, Vietnam and Malaysia would effectively make the products unmarketable to U.S. consumers. That follows a yearlong investigation by the U.S. Department of Commerce into claims by American producers that Chinese companies in those countries were dumping solar cells and panels in the U.S. at artificially low prices.

China has become the biggest target in a trade war that the U.S. launched this year over what it sees as unfair trade practices used by most trading partners, including many of Washington’s allies. Tit-for-tat tariff responses by the White House and Beijing are threatening to make much of the trade between the world’s two biggest economies grind to a halt.

The solar tariffs announced Monday illustrate concern in the U.S. that China could avoid paying punitive tariffs by raising exports from a global network of factories that it has expanded in recent years.

The American Alliance for Solar Manufacturing Trade Committee last year filed a petition for protection from what it said were China’s “harmful trade practices.” The industry group alleged that Beijing’s industrial policy has led to massive subsidization in the solar sector in China and Southeast Asia, threatening the U.S. solar manufacturing industry.

The new duties reflect the commerce department’s findings that some Chinese producers have been shipping solar products through Southeast Asian countries to avoid paying tariffs imposed in the past.

The U.S. has become a lucrative market for makers of renewable-energy products, fanned partly by policies introduced by the Biden administration such as the Inflation Reduction Act. Solar energy accounts for more than 15% of electricity generated in states including California and Massachusetts.

Last year, the Biden administration issued preliminary decisions to set countervailing duties on solar panels and cells produced in the four Southeast Asian countries, ranging from 0%-300%.

The new duties imposed by the Trump administration apply to several companies in Southeast Asia. Some producers in Cambodia face tariffs of more than 3,500%.

That comes at a challenging time for the solar industry broadly.

Since regaining office, President Trump has begun implementing an energy policy that could jolt demand for solar panels, including by lifting certain barriers to mining coal that some analysts think will slow the closure of coal-fired power plants. Recently introduced tariffs on most U.S. trading partners are expected to drive up costs of new clean-energy projects, including solar.

Write to Kimberley Kao at kimberley.kao@wsj.com