US Treasury Secretary Janet Yellen is set to caution against a surge in inexpensive exports from China, particularly in sectors like electric vehicles, citing potential “global spillovers.”
Yellen intends to emphasize the risks of excess capacity during her upcoming visit to China and urge Beijing to take corrective measures.
Her remarks are scheduled to be delivered in Georgia during her second trip to China as Treasury chief this year.
While she plans to highlight the positive impacts of President Joe Biden’s Inflation Reduction Act and recent business investments, Yellen also expresses concerns about China’s excessive industrial capacity and its impact on other nations.
Yellen highlights previous Chinese government support in sectors such as steel and aluminum, leading to overinvestment and excess capacity, which subsequently affected industries globally.
She warns of a similar trend emerging in new industries like solar energy, electric vehicles, and lithium-ion batteries, potentially distorting global prices and production and affecting companies and workers.
Yellen stresses the importance of fair competition for American firms and workers and has previously called for China to adopt a less state-driven economic policy.
This sentiment aligns with longstanding complaints from US companies about unfair business practices in China.
