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Yellen says US has option to shield industries against China

Yellen says US has option to shield industries against China
United States Secretary of the Treasury Janet Yellen in São Paulo, Brazil, on 27 February 2024. (Photo: EPA-EFE / Isaac Fontana)

Treasury Secretary Janet Yellen suggested the US will retain the option to protect new industrial sectors against China after what she described as the Asian nation’s massive state investments in areas including clean energy.

Yellen made the remarks while speaking with reporters on Wednesday en route to China, which she’ll be visiting for the second time in nine months. Asked whether she plans to brief her counterparts on likely fresh trade barriers to address China-driven overcapacity in clean energy sectors, Yellen said she “wouldn’t want to rule out other possible ways in which we would protect them”.

The Treasury chief’s comments come as Chinese leaders have been pouring money into manufacturing, focusing on new industries such as electric vehicles, batteries and renewable energy, in a search for new sources of growth for the country’s slowing economy.

The White House has hinted at a pending tariff decision, saying that President Joe Biden raised China’s “unfair trade policies and non-market economic practices” with Chinese President Xi Jinping in a call earlier this week.

Yellen’s trip is partly aimed at pressing Chinese counterparts on the build-up of industrial overcapacity that poses threats to the rest of the world’s economies. She also wants to boost cooperation with Beijing on “shared challenges like illicit finance and climate change,” she said on X. 

While in China, Yellen will spend two days in the southern commercial and manufacturing hub of Guangzhou beginning 5 April before heading to Beijing for two more days of talks.

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