U.S. Treasury Secretary Janet Yellen testifies during a hearing before the Subcommittee on Financial Services and General Government of the House Appropriations Committee on the Rayburn House Office Building on Capitol Hill, March 21, 2024, in Washington.
Alex Wong | Getty Images
Treasury Secretary Janet Yellen warned Wednesday that China is treating the global economy as a dumping ground for cheaper clean energy products, depressing market prices and limiting organic production within the U.S.
“I am concerned about the global spillover effects of the overcapacity we are seeing in China,” he added. Yellen he said during a speech at Georgian solar energy company Suniva. “China’s excess capacity distorts global prices and production patterns and harms 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 may ship to other countries at lower prices. This makes it harder for younger, green manufacturing industries within the U.S. and other countries to compete.
Yellen said she intends to place pressure on Chinese officials about these trade practices during her upcoming visit to China.
“I plan to make this a key discussion point on my next trip to this country,” she said. “I will press my Chinese counterparts to take the necessary steps to resolve this issue.”
The secretary’s concerns come because the White House tries to construct the nation’s growing clean energy industry using investments made within the Inflation Reduction Act of 2022, in addition to other laws comparable to CHIPS and the Science Act.
Yellen often touted the gains from these investments, including: during one other recent speech by which she doubled down on the IRA-led electric vehicle ‘boom’.
However, these investments are catching up with the Chinese government.
“The Biden administration also acknowledges that these investments are new,” Yellen said Wednesday.
Meanwhile, China has been investing billions in clean energy for years, outpacing the remaining of the world in its energy transition.
Yellen added that the more China’s clean energy glut clashes with global market prices, the more serious the availability chain situation for these energy sectors will be.
“President Biden is committed to protecting our industry from unfair competition,” Yellen said.
The Chinese embassy in Washington has denied the claim that there’s a glut of Chinese clean energy products.
Yellen’s comments highlighted continuing trade tensions between the U.S. and China, at the same time as the 2 countries attempt to stabilize relations.
President Joe Biden met with Chinese President Xi Jinping in November as a minor ice-breaker after years of tensions marked partly by a tariff war began by former President Donald Trump.
Trump has decided to revive significant levels of tariffs on Chinese products if he wins a second presidential term.
Since the Biden-Xi meeting, strengthening U.S.-China relations has proven to be an uncertain endeavor on account of persistent concerns about cybersecurity and trade.
In February, Biden launched an investigation into Chinese smart cars, which he said pose a national security threat because they travel on American roads and connect with U.S. infrastructure.
“China is determined to dominate the future of the auto market, including through unfair practices,” Biden said in February statement. “China’s policies could flood our market with vehicles, posing a risk to our national security. I won’t let this occur on my watch.”
