U.S. Treasury Secretary Janet Yellen testifies during a hearing before the Subcommittee on Financial Services and General Administration of the House Budget Committee at the Rayburn House Office Building on Capitol Hill on March 21, 2024 in Washington, DC.
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Treasury Secretary Janet Yellen warned Wednesday that China views the global economy as a dumping ground for its cheaper clean energy products, depressing market prices and stifling green manufacturing in the United States
“I’m concerned about the global impact of the overcapacity we’re seeing in China,” Yellen said during a speech at a Georgia solar company called Suniva. “China’s overcapacity is distorting global prices and production patterns, harming American companies and workers as well as companies and workers around the world.”
China has a surplus of solar power, electric vehicles and lithium-ion batteries that it can ship to other countries at cheaper prices. That makes it difficult for more youthful green manufacturing industries in the U.S. and elsewhere to compete.
Yellen said she plans to pressure Chinese officials over these trade practices during her upcoming visit to China.
“I plan to make it a central topic of discussion on my next trip there,” she said. “I will urge my Chinese colleagues to take the necessary steps to address this issue.”
The secretary’s concerns come as the White House seeks to build a burgeoning clean energy industry domestically with investments from the Inflation Reduction Act of 2022 and other legislation like the CHIPS and Science Act.
Yellen has regularly highlighted the gains from these investments, including in another recent speech in which she reemphasized the IRA-fueled electric vehicle “boom.”
But these investments are making up for the Chinese government’s backlog.
“The Biden administration also recognizes that these investments are new,” Yellen said Wednesday.
Meanwhile, China has been pouring billions into clean energy for years, outperforming the rest of the world in its energy transition.
Yellen added that the more China’s abundance of clean energy affects global market prices, the worse supply chains for these energy sectors become.
“President Biden is committed to doing everything we can to protect our industries from unfair competition,” Yellen said.
The Chinese Embassy in Washington disputed claims that there is a surplus of Chinese clean energy products.
Yellen’s comments highlight ongoing trade tensions between the U.S. and China, even as the two countries try to stabilize their relations.
Read more about CNBC’s politics coverage
President Joe Biden met with Chinese President Xi Jinping in November to break the ice after years of tensions marked in part by a tariff war waged by former President Donald Trump.
Trump has vowed to reinstate significant tariffs on Chinese products if he wins a second term as president.
In the time since the Biden-Xi meeting, strengthening U.S.-China ties has proven a precarious task due to ongoing cybersecurity and trade concerns.
In February, Biden launched an investigation into Chinese smart cars, which he said pose a national security risk because they connect to U.S. infrastructure when driving on American roads.
“China is determined to dominate the future of the automotive market, including through the use of unfair practices,” Biden said in a February statement. “China’s policies could flood our market with its vehicles and pose a risk to our national security. I won’t let that happen while I’m on guard.”
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2024-03-28 21:48:10
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