During her official visit to China, U.S. Treasury Secretary Janet Yellen has been engaging with Chinese leaders to address what the U.S. views as unfair trade practices. Yellen's focus has been on encouraging China to reconsider its domestic manufacturing policies, particularly in the clean energy sector.
Chinese state media have expressed skepticism towards Yellen's message, raising concerns about the potential imposition of additional U.S. tariffs on green energy products. The Xinhua News Agency highlighted the perceived U.S. stance on Chinese overcapacity in clean energy as a possible pretext for protectionist measures.
China's significant investments and policy support in solar panel and electric vehicle manufacturing have led to an oversupply of production capacity, resulting in price competition and cost reductions in green technologies. While this has benefited consumers and global efforts to reduce reliance on fossil fuels, Western governments are wary of the impact on their domestic markets and employment.
Yellen emphasized the importance of a mutually beneficial economic relationship between the U.S. and China, suggesting that a shift in China's policies towards promoting domestic consumption over green energy subsidies would be advantageous for both countries and the global economy.
Not ruling out the possibility of tariffs in response to China's manufacturing practices, Yellen's discussions with Chinese officials have underscored the U.S. government's commitment to addressing concerns related to national security and economic competitiveness.
The U.S. has taken legislative and executive actions to enhance its semiconductor industry and scientific research capabilities, aiming to create more high-tech jobs and bolster its competitive position vis-a-vis China. Efforts such as the CHIPS and Science Act and executive orders restricting high-tech investments in China reflect the U.S. government's strategic approach to safeguarding its technological edge.
Yellen is scheduled to continue her discussions in Beijing with senior officials, economists, and the central bank governor, as part of ongoing efforts to foster dialogue and cooperation between the world's two largest economies.
