Yellen: The US will not allow Chinese imported products to destroy emerging industries.

U.S. Treasury Secretary Yellen emphasized that she does not want to see deterioration and tension in U.S.-China economic relations, but she will not allow Chinese imports to destroy emerging industries.

Yellen held a press conference in Beijing in the afternoon. When summarizing her visit to China, she said that recent days of talks with Chinese officials have promoted the interests of the United States. She emphasized that China and the United States have close economic ties and that China is an important market for U.S. goods and services. Competition between Chinese enterprises will make American industries more dynamic and innovative. He reiterated that the United States does not seek to decouple from China and hopes to maintain the broad investment and trade relations between China and the United States so that American companies and individuals can benefit more.

However, Yellen mentioned concerns about China’s weak domestic demand and over-investment in industries such as electric vehicles, batteries and solar products, driven by massive government support.

She pointed out that with the strong support of the Chinese government more than ten years ago, low-cost Chinese steel flooded into the global market, seriously weakening industries around the world and the United States. She stressed that the United States would not accept emerging industries being eliminated like the U.S. steel industry 10 years ago. Cheap imports from China hit hard. She has made it clear to China that U.S. President Biden will not allow the situation to repeat itself, because when the global market is flooded with cheap Chinese products, the viability of companies in the United States and other countries will be threatened, and Washington will push China Change industrial policy.

Yellen said that China’s over-investment has caused factory production capacity to far exceed domestic demand. A newly established exchange forum will discuss in depth and seek to solve the problem of overcapacity, but it will take time to reach a solution. A possible short-term solution is for China to boost consumer demand and change its growth model of supply-side investment.

Yellen also described having had difficult conversations with China on national security issues, including U.S. concerns about Chinese companies supporting Russia in the Ukrainian war.