China is not stopping price control efforts; rather, the government is intensifying its interventions to regulate a market battered by severe overcapacity and a destructive price war. Beijing is stepping in because previous attempts by manufacturers to "self-regulate" or establish voluntary price floors failed to stabilize the market, which has seen massive losses.

China is not stopping price control efforts; rather, the government is intensifying its interventions to regulate a market battered by severe overcapacity and a destructive price war. 
Beijing is stepping in because previous attempts by manufacturers to "self-regulate" or establish voluntary price floors failed to stabilize the market, which has seen massive losses. 
Key Policy Shifts and Interventions:-
Curbing "Disorderly Competition":-
 In July 2025, President Xi Jinping called for an end to "disorderly low-price competition" in strategic sectors including solar, electric vehicles, and batteries.
Government Oversight: -
Multiple government bodies, including the Ministry of Industry and Information Technology (MIIT) and the State Administration for Market Regulation (SAMR), are holding meetings with industry leaders and vowing stronger action against unfair pricing practices, price collusion, and fraud.
Capacity Reduction: -
The government is pushing for the orderly withdrawal of outdated production capacity and discouraging new, low-quality investment to address the core problem of oversupply.
Potential Price Floors: -
Regulators are considering imposing minimum price rules based on production costs and banning below-cost sales.
Export Rebates & Costs:-
 Policy changes are expected to increase costs, with reports from Wood Mackenzie forecasting a 9% rise in global solar and storage equipment prices due to these policy shifts and the potential elimination of a 13% VAT export rebate. 
This intervention marks a shift from a market-driven, subsidy-dependent expansion model to a more controlled, quality-focused industry consolidation, which is expected to lead to a stabilization or potential increase in global solar product prices. 
   China Hits the Brakes on Solar Price War; What This Means for the Euro.

MJF Lion ER YK Sharma 

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