Guangzhou, China – US Treasury Secretary Janet Yellen embarked on her second visit to China, aiming to strengthen the relationship between the world’s two largest economies. During her initial meetings in Guangzhou, Yellen expressed concerns about the oversupply of Chinese goods in industries like electric vehicles (EVs) and solar panels, a crucial issue leading up to the upcoming US presidential election.
Yellen emphasized the importance of a balanced economic relationship that benefits both countries during her discussions with leaders in Guangdong province, China’s manufacturing hub. She stressed the need for fair competition for American workers and businesses, highlighting the issue of China’s industrial overcapacity, which has raised global concerns about its impact on international markets.
US officials and lawmakers have raised alarms about the potential consequences of China’s excess capacity, fearing the global market could be flooded with cheap products, adversely affecting local industries and jobs. Yellen has not ruled out the possibility of implementing trade barriers if China fails to address the issue of overcapacity, although no immediate measures are planned.
Yellen’s visit follows a phone call between US President Joe Biden and Chinese leader Xi Jinping, their first conversation since a historic summit in California. During her four-day trip to Guangzhou and Beijing, Yellen is slated to meet with top Chinese officials, including Premier Li Qiang, Vice Premier He Lifeng, and other key figures to discuss various issues, such as countering illicit finance and collaborating on global challenges like climate change.
Experts anticipate limited tangible outcomes from Yellen’s visit, with tensions escalating as Chinese leaders focus on boosting manufacturing for exports to offset domestic economic challenges. Analysts believe Beijing is unlikely to alter its economic policies despite discussions with Yellen, underscoring the enduring complexities in the US-China relationship.