AU Optronics (AUO) president Paul Peng has urged the China government to take a cautious approach towards raising tariffs on LCD panel imports, describing such taxes as a double-edged sword, according to a report.
China raised its tariffs on LCD panel imports from 3% to 5% in 2012, and TCL chairman Dongsheng Li has recently suggested the tariffs be raised further to 10%.
Raising tariffs could protect doemstic makers, but previous experiences have shown that it could also dampen their competitiveness, Peng said in a recent interview by the China Business News.
Opening the market to free competition would instead help firms improve their businesses, Peng was cited as saying by the China-based media outlet.
Peng said that AUO, bracing for high tariffs, is stepping up its cooperation with China vendors for their TV exports to overseas markets.
China makers produce 130 million TVs a year, 90 million of which are exported, Peng said. Imports taxes on LCD panels for these subsequently exported TVs can be refunded, he added.