BEIJING (AP) – Treasury Secretary Janet Yellen said Monday after concluding four days of talks with Chinese officials that the Biden administration will press China to make industrial policy changes that threaten U.S. jobs. said.
He also said there were “difficult conversations” in Beijing about national security, including U.S. concerns that Chinese companies were supporting Russia’s war in Ukraine.
But the focus of her visit was on industrial policy and what the United States and Europe describe as overcapacity in Chinese manufacturing. Rich countries worry that a wave of low-cost exports from China will overwhelm domestic factories. Yellen cited the manufacturing of electric vehicles and their batteries and solar energy equipment, areas the U.S. administration is trying to promote domestically, as areas where Chinese government subsidies are helping to rapidly expand production.
“China is currently too big for the rest of the world to absorb this huge capacity. The actions China takes today could change world prices,” said People of China, which is China’s official name. she said, using the acronym Republic. “And when artificially cheap Chinese products flood the world market, the viability of American and other foreign companies will be called into question.”
He said the United States will host the Chinese side at the fourth Economic and Financial Working Group meeting next week, “where these issues will be thoroughly discussed.”
The United States and China established a working group in September last year with the aim of easing tensions and deepening relations between the two countries. Further discussions will take place at the same time as the IMF and World Bank’s spring meetings.
It is unclear how China will respond to such a call. European officials have repeatedly raised this issue during their visits to China, but there are no signs of any change on the Chinese side. Furthermore, one of leader Xi Jinping’s major goals is to develop the country into a great power so that it does not feel the need to bow to outside pressure.
But overcapacity is also affecting China, where price competition in the electric vehicle sector is expected to drive some manufacturers out of business, and experts say there will be an increase in the number of manufacturers aiming to promote new technology. It calls for better policy coordination. During Yellen’s visit, the governments agreed to begin talks on what both sides called “balanced growth.”
“We are going to emphasize in this meeting the need for policy change by China,” Yellen said at a news conference outside the US ambassador’s residence in Beijing on a crisp spring day.
Yellen argued that China’s consumer spending is increasing due to heavy government subsidies for the solar power, EV, and lithium-ion battery industries. There will be less need for large-scale investments.” “Entry into building supply of green energy products”
The state-run Xinhua news agency said on Saturday that the Chinese side “fully addressed the issue of production capacity” during a meeting between Yellen and Vice Premier He Lifeng, who is in charge of China-US economic and trade issues.
More than a decade ago, the Secretary of the Treasury said, “A flood of low-cost Chinese steel has devastated industry around the world and in the United States.” President Biden and I have made it clear that we will not accept that reality again. ”
Regarding the Ukraine war, Yellen warned that banks that facilitate the sale of munitions and military supplies to Russia could face U.S. sanctions.
“I emphasized that companies, including Chinese companies, must not provide material support to Russia’s war effort, and if they do, they will face serious consequences.”
Russian Foreign Minister Sergei Lavrov arrived in Beijing on Monday for talks on the Ukraine conflict and other issues.
Asked about Yellen’s warning, Chinese Foreign Ministry Spokesperson Mao Ning said the United States “should not tarnish or attack the normal relations between China and Russia, and protect the legitimate rights and interests of China and Chinese companies.” It should not be damaged.”
Former US Federal Reserve Chairman Yellen met with China’s central bank governor, Ban Gongsheng, early Monday morning.
