US Treasury Secretary Janet Yellen (pictured) said on April 5 that China would benefit from cutting excess production capacity that is weighing down other countries’ economies. The photo was taken in Guangzhou on the 5th (2024, Reuters / Tingshu Wang)
GUANGZHOU, China (Reuters) – U.S. Treasury Secretary Janet Yellen said on Wednesday there were growing concerns about the impact of China’s excess manufacturing capacity on the global economy. Speaking at the American Chamber of Commerce in Guangzhou, Guangdong Province.
China is too big to rely on exports alone to achieve rapid growth, he said, and would benefit by cutting excess production capacity that is straining other countries’ economies.
Yellen said she understands that the Chinese government’s direct and indirect support for manufacturing is tied to domestic development goals.
He went on to say that this support has currently resulted in China’s production capacity significantly exceeding domestic demand and world market capacity.
Overcapacity in China has been a problem for some time, but new risks have emerged in new sectors such as electric vehicles (EVs), batteries and solar products, putting workers and companies competing in the US , Mexico and India at a disadvantage. supposes it is covered with
“We believe it is in China’s interest to address overcapacity and consider market-based reforms,” he said. He drew parallels with China’s market reforms of the past few decades, which he said had spurred growth and lifted hundreds of millions of people out of poverty.
It also raised concerns raised by US and multinational companies about the deteriorating business environment in China, including being treated unfairly compared to competitors in China.
At the start of her meeting with Deputy Prime Minister He Lifeng, Yellen said it was necessary for the two countries to have a close dialogue on difficult issues such as overcapacity and economic regulations related to national security.
He noted that financial working groups in both countries have been considering measures to limit financial risks should a bank fail in either the United States or China. “Both sides have exchanged technical views, including a dry run on how to respond jointly if a major bank in the United States or China went bankrupt,” he said, but did not give details of the results of the talks. . Ta.
He said one of the purposes of his meeting with Chinese officials was to establish “robust channels of dialogue” between the two governments.
In addition to financial system risks, he said the United States and China are working together to tackle areas such as money laundering and climate change.
Yellen is scheduled to meet with Chinese government officials in Beijing from the 6th to the 8th.
Yellen’s comments about the risks of China’s overcapacity have been criticized by state media as a double standard.
The English newspaper China Daily argues that basic economics is to export surplus products to foreign markets once domestic demand has been met. “Western countries have been doing this for centuries, but when it comes to China, it is seen as an ‘overcapacity problem’ that threatens the world,” he said.
Our Code of Conduct: Thomson Reuters “Principles of Trust”, opens a new tab
#Treasury #Secretary #expresses #concern #Chinas #excess #production #capacity #rely #exports #Reuters
