Beijing
During a visit to China on April 5, US Treasury Secretary Janet Yellen warned that the Chinese government's industrial subsidies could pose risks to the resilience of the global economy.
Yellen arrived in Guangzhou on April 4 for several days of talks with Chinese officials, her second trip to the world's second-largest economy in less than a year.
Speaking on April 5, he spoke about China's “overcapacity,” saying that massive industrial subsidies are creating too much product that could flood global markets and hurt businesses in the U.S. and other countries. expressed concern.
“Direct and indirect government support has now led to production capacity that significantly exceeds what China's domestic demand and the global market can sustain,” he told a gathering of the U.S. business community in the city. Ta.
“Overcapacity could lead to large exports at depressed prices,” she said.
“And that could lead to supply chain concentration, posing risks to the resilience of the global economy.”
In the morning, Yellen told the governor of Guangdong, a vast province that symbolizes the reform and development that has driven China's breakneck growth, that the U.S. is committed to a “sound economic relationship.”
But he stressed that this requires “a level playing field for American workers and businesses” and “open and direct communication on areas of disagreement.”
“This includes the issue of industrial overcapacity in China, which the United States and other countries are concerned about could cause global ramifications,” he said.
The Chinese government has dismissed concerns about massive state aid for the industry, slamming the EU's EV subsidy probe last month as “protectionism” and part of Western efforts to politicize international trade. .
As U.S. President Joe Biden pushes to expand domestic manufacturing in clean energy, policymakers have warned that China's overcapacity could hurt growth in these industries, with large Washington's concerns about exports are emerging.
Paul Triolo, associate partner for China at Albright Stonebridge Group, said the Biden administration is very sensitive to the U.S. auto industry's concerns about China and EVs, especially in an election year.
“The administration is likely to take some action that shows it is willing to act preemptively to prevent future problems with China's overproduction of EVs,” he told AFP.
But he warned that the Chinese government was likely to react “terribly” given the impact on U.S. automakers is not yet known.
During her visit, Yellen is scheduled to meet with Chinese Premier Li Qiang, Vice Premier He Lifeng, Central Bank Governor Ban Gongsheng, and Finance Minister Lan Fongsheng.
The meeting with Mr. He will delve deeper into the economic situation in both countries and address more sensitive areas such as national security and Beijing's alleged support for Russia's defense industrial base.
