Yellen Cautions China on Distorting Markets with Green Export Surge
The United States, led by Treasury Secretary Janet Yellen, has voiced concerns about China's increasing export of inexpensive green technology, which could potentially destabilize global markets. The U.S. administration is focusing on bolstering domestic industries such as solar technology and electric vehicle batteries, backed by the Inflation Reduction Act of 2022, which allocates nearly $400 billion for low-emission energy production. In contrast, China has been intensifying its investment in manufacturing to boost its economy, dominating the solar industry with state-supported domestic companies.
Secretary Yellen intends to confront Chinese officials about the risks of overcapacity in key sectors during her diplomatic visit to China. She has cited the historical precedent of overinvestment in industries like steel and aluminum, which, while beneficial for Chinese production and employment, has negatively impacted industries globally. Yellen plans to highlight the issue by visiting a reopened U.S. solar-cell manufacturing facility in Georgia, which had previously closed due to the influx of cheaper imports.
The EU is also responding to the situation, considering additional tariffs on Chinese electric vehicles amid allegations of unlawful financial support by Beijing. These developments reflect broader tensions between China and other economies over trade policies, investment restrictions, and cybersecurity concerns. The U.S. pushback against Chinese exports comes as high-level diplomacy between Washington and Beijing continues, with Yellen's visit marking her second trip to China this year.
