BEIJING (AP) \u2014 The Biden administration will push China to change an industrial policy that poses a\u00a0threat to U.S. jobs, Treasury Secretary Janet Yellen said Monday after wrapping up four days of talks with Chinese officials.<\/p>\n\n\n\n
She also said in Beijing they had \u201cdifficult conversations\u201d about national security, including American concerns that Chinese companies are supporting Russia in its war in Ukraine.<\/p>\n\n\n\n
But the focus of her trip was\u00a0industrial policy, and what the U.S. and Europe describe as manufacturing overcapacity in China. Wealthy nations fear a wave of low-priced Chinese exports that will overwhelm factories at home. Yellen cited the manufacturing of\u00a0electric vehicles\u00a0and their batteries as well as solar energy equipment \u2014 sectors that the U.S. administration is trying to promote domestically \u2014 as areas where Chinese government subsidies have driven rapid expansion of production.<\/p>\n\n\n\n
\u201cChina is now simply too large for the rest of the world to absorb this enormous capacity. Actions taken by the PRC today can shift world prices,\u201d she said, using the acronym for China\u2019s official name, the People\u2019s Republic of China. \u201cAnd when the global market is flooded by artificially cheap Chinese products, the viability of American and other foreign firms is put into question.\u201d<\/p>\n\n\n\n
She said the U.S. would host Chinese counterparts for their fourth economic and financial working groups meetings next week \u201cwhere these issues will be discussed at length.\u201d<\/p>\n\n\n\n
Last September, the U.S. and China\u00a0formed working groups\u00a0in an effort to\u00a0ease tensions\u00a0and deepen ties between the two nations. The upcoming discussions will coincide with the IMF and World Bank Spring Meetings.<\/p>\n\n\n\n
It\u2019s unclear how China will respond to such calls. European officials have repeatedly raised the issue on visits to China with no sign of any change on the Chinese side. Moreover, one of leader Xi Jinping\u2019s major goals is to build the nation into a major power so it doesn\u2019t feel compelled to bend to outside pressure.<\/p>\n\n\n\n
But overcapacity also affects China \u2014 price wars in the electric vehicle sector are expected to drive some makers out of business \u2014 and experts have called for better coordination of policies designed to promote new technologies. The\u00a0government agreed\u00a0during Yellen\u2019s visit to start talks on what the two sides called \u201cbalanced growth.\u201d<\/p>\n\n\n\n
\u201cWe intend to underscore the need for a shift in policy by China during these talks,\u201d Yellen said at a news conference held outdoors on a balmy spring day at the U.S. ambassador\u2019s residence in Beijing.<\/p>\n\n\n\n
Advocating for higher consumer spending in China in response to its large government subsidies to solar, EV and lithium-ion battery industries, Yellen said: \u201cIf consumer spending were higher as a share of GDP, there would be less need to have such large investment going into building supply\u201d of green energy products.<\/p>\n\n\n\n
On Saturday, the official Xinhua News Agency said that the Chinese side had \u201cresponded fully to the issue of production capacity\u201d during Yellen\u2019s talks with Vice Premier He Lifeng, the lead person for China-U.S. economic and trade affairs,<\/p>\n\n\n\n
More than a decade ago, the treasury secretary said, a flood of \u201cbelow-cost Chinese steel … decimated industries across the world and in the United States. I\u2019ve made clear that President Biden and I will not accept that reality again.\u201d<\/p>\n\n\n\n
On the war in Ukraine, Yellen warned that any banks that facilitate the sale of military or dual-use goods to Russia could face U.S. sanctions.<\/p>\n\n\n\n
\u201cI stressed that companies, including those in the PRC, must not provide material support for Russia\u2019s war and that they will face significant consequences if they do,\u201d she said.<\/p>\n\n\n\n
Russian Foreign Minister\u00a0Sergey Lavrov\u00a0arrived in Beijing on Monday for\u00a0talks on the Ukraine conflict\u00a0and other issues.<\/p>\n\n\n\n
Asked about Yellen\u2019s warnings, Chinese Foreign Ministry Spokesperson Mao Ning said that the U.S. \u201cshould not smear or attack the normal state-to-state relations between China and Russia and should not harm the legitimate rights and interests of China and Chinese enterprises.\u201d<\/p>\n\n\n\n
Yellen, the former chair of the U.S. Federal Reserve, met with China\u2019s central bank governor, Pan Gongsheng, earlier Monday.<\/p>\n","protected":false},"excerpt":{"rendered":"
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