appConfigEntityId

bodyType

customContents

entityId

entityUuid

isVideo

articlePageQuery

article

articleSchemaContent

content

hooksArticlePageAdvertisementConfigArticle

hooksArticlePageFloatingButtonConfigArticle

appConfig

filter

json

liveArticle

Sylvia Ma

Sherry Wang

Chinese power equipment stocks have tumbled after the United States moved to bar certain foreign-made grid equipment and related software, but some analysts believe the sell-off may have been excessive, with enforcement still uncertain and Chinese firms able to offset the impact in other markets.
Sungrow Power Supply, a major Chinese inverter maker, slumped 12.24 per cent on Thursday after US President Donald Trump signed an executive order a day earlier, declaring a national emergency and barring certain foreign-produced bulk-power equipment and associated software from being bought or installed in the US.
Also on Thursday, Sieyuan Electric, which is listed on Shenzhen’s main board where daily price movements are capped at 10 per cent, hit its maximum limit with a 10 per cent fall.
Despite the sharp equity-market reaction, analysts said investors might have overestimated the potential fallout.
Zhou Mi, a researcher at the Chinese Academy of International Trade and Economic Cooperation, a think tank under the Ministry of Commerce, said the direct impact would not be as severe as markets feared, though the ban “clearly touches a lot of companies”.
Its real-world effect, he noted, would depend on how strictly Washington enforced the order, as US officials would need to weigh the restrictions against potential disruptions to the American economy and end users.
From a purely commercial standpoint, the long-term financial impact of this ban on Chinese companies will be fairly limited
Wu Xinbo, Fudan University
“We’ve seen similar playbooks before – for instance, when restrictions were placed on DJI drones. In reality, many US users couldn’t simply abandon or replace that equipment overnight,” Zhou said.
“I believe the market sentiment has, at times, exaggerated the actual impact. How this plays out in practice remains to be seen.”
As of 11.30am on Friday when the domestic A-share market closed for lunch, Sieyuan had fallen a further 6 per cent, while Sungrow was down 1.24 per cent. The South China Morning Post reached out to both companies by phone, but neither had responded at the time of publication.
Wu Xinbo, dean of the Institute of International Studies at Fudan University in Shanghai, stressed that the US was only one among many markets for Chinese firms. The Belt and Road Initiative, he noted, continued to drive infrastructure development worldwide, ensuring exports of electrical equipment despite any direct impact of Washington’s policy shift.
According to Chinese customs data for the first seven months of this year, US-bound shipments of electrical transformers, static converters and inductors accounted for 8.6 per cent of China’s total exports in the category by value, while storage batteries also accounted for just 9 per cent.
“From a purely commercial standpoint, the long-term financial impact of this ban on Chinese companies will be fairly limited,” Wu said.




“The actual commercial damage isn’t nearly as severe as people think. That is why I believe the market exaggerated the fallout.”
The White House directive comes amid growing scrutiny of foreign-made hardware used in critical infrastructure, particularly products from China. According to the order, Trump stated that certain foreign actors were “increasingly creating and exploiting vulnerabilities” in the nation’s bulk-power system, describing the situation as an “unusual and extraordinary threat”.
In response to the move, Chinese Foreign Ministry spokesman Lin Jian said Beijing consistently opposed “overstretching the concept of national security to suppress foreign companies”, urging the US to provide a fair, just and non-discriminatory environment for businesses from all countries.
The presidential order followed a July decision by the US Federal Communications Commission (FCC) to add foreign-produced power inverters and advanced robotic devices to its “Covered List”. The commission argued such inverters introduced “additional vulnerabilities which compound as inverter-based resources proliferate on the US grid”.
Responding to the FCC move, China’s commerce ministry said robots and power inverters were “normal international goods” and that all sides, including the US, benefited from trade. It warned that if Washington persisted with the move, “China would resolutely take countermeasures to safeguard its legitimate rights and interests”.


Rare honour: Trump will greet Xi at Andrews, not just the White House

China, US may unveil measures to boost military ties when Xi visits Washington

China trusted more than US, EU on AI regulation in Pew survey of middle-income countries

BYD, Xiaomi and Innolight executives likely to join Xi Jinping on US visit: sources

US-China trade war

Chinese power stocks slump after US grid ban: is the sell-off warranted?

Shenzhen-listed Sieyuan Electric, a grid-equipment maker, is among the firms affected by Washington’s latest order. Photo: Handout

China and Iran sanctions: what US moves mean for Beijing, and its retaliation options

US President Donald Trump (right) walks with President Xi Jinping in Beijing on May 15. Photo: Evan Vucci/Pool via AP

China’s steel sector must avoid US rust belt’s fate: party journal

A worker polishes a steel bicycle rim at a factory manufacturing sports equipment in Hangzhou, Zhejiang province. Photo: Reuters

Steel coils are seen at a workshop in Tangshan, Hebei province, on July 22. Photo: Xinhua

US warns Canada not to think it can win ‘devastating’ trade war

The US and Canadian flags flutter next to the Blue Water Bridge border crossing in Point Edward, Ontario. Photo: AFP

Prime Minister Mark Carney and Canada-US Trade Minister Dominic LeBlanc leave a news conference in Ottawa on Saturday about Canada’s response to new US tariffs. Photo: The Canadian Press/AP

Transport trucks cross the Ambassador Bridge in Windsor, Ontario, into the US, on Saturday. Photo: The Canadian Press/AP

China’s retaliation against US shows depth of its trade war strategy, analysts say

China has broadened its economic strategy, introducing a growing array of legal, regulatory, and trade measures to respond more forcefully to US sanctions. Photo: Shutterstock

US President Donald Trump and Chinese President Xi Jinping arrive for a state dinner at the Great Hall of the People on May 14 in Beijing. Photo: AP

China braces as new US global tariffs loom: fresh trade war or managed friction?

An American flag flies near a container ship at the Port of Los Angeles in California on May 28. Photo: Getty Images via AFP

Economy

Global Economy

News

Economy, Trade & Business

Sungrow and Sieyuan shares fell sharply after Washington’s order, but analysts say markets may be overlooking enforcement hurdles and strong global demand


Sungrow and Sieyuan shares fell sharply after Washington’s order, but analysts say markets may be overlooking enforcement hurdles and strong global demand.


Chinese power stocks slump after US grid ban: is the sell-off warranted?

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Sungrow and Sieyuan shares fell sharply after Washington’s order, but analysts say markets may be overlooking enforcement hurdles and strong global demand

Sungrow and Sieyuan shares fell sharply after Washington’s order, but analysts say markets may be overlooking enforcement hurdles and strong global demand