Yellen Blasts China's Overcapacity

Treasury Secretary Janet Yellen came down hard on China last week, warning that Beijing is dumping clean energy products on the global market, bringing down prices and threatening the Administration’s effort to promote green manufacturing.

“I am concerned about global spillovers from the excess capacity that we are seeing in China,” Ms. Yellen said in a speech while visiting US solar company Suniva in Georgia.

“China’s overcapacity distorts global prices and production patterns and hurts American firms and workers, as well as firms and workers around the world,” she added.

Beijing is engaged in excess capacity building in “new” industries like solar, EVs and lithium-ion batteries, the Secretary said.

The United States is not the only country concerned about China’s overcapacity. “These are concerns that I increasingly hear from government counterparts in industrialized countries and emerging markets, as well as from the business community globally,” she said.

Ms. Yellen said she plans to make concerns about overcapacity a main topic of discussion during her upcoming visit to China.

“I will convey my belief that excess capacity poses risks not only to American workers and firms and to the global economy, but also to productivity and growth in the Chinese economy, as China itself acknowledged in its National People’s Congress this month. And I will press my Chinese counterparts to take necessary steps to address this issue.”