US pressing EU to clamp down on Chinese exports
US Treasury Secretary Janet Yellen has urged the EU to penalize cheap exports of Chinese green technology, in what could push the bloc toward a trade war with the Asian country.
During a visit to Frankfurt on Tuesday, Yellen reiterated recent claims that China’s excess production capacity threatened both American and EU companies.
“China’s industrial policy may seem remote as we sit here in this room, but if we do not respond strategically and in a united way, the viability of businesses in both our countries and around the world could be at risk,” Yellen told reporters at the Frankfurt School of Finance and Management.
Yellen argued in favor of 100% tariffs, which are seen by many economists as protectionist and a potential trigger for wider trade wars with China. Last week, US President Joe Biden announced the quadrupling of import duties on Chinese electric vehicles to over 100% and a doubling of semiconductor duties to 50%.
In her remarks in Frankfurt, the Yellen told EU leaders it would be “more forceful to communicate to China as a group.”
The comments come a week after the Biden administration hiked tariffs on $18 billion in Chinese goods including electric vehicles, batteries, semiconductors, steel, aluminum, critical minerals, solar cells, ship-to-shore cranes, and medical products, while retaining tariffs on over $300 billion in goods imposed by the previous administration of Donald Trump.
The EU, which sells a greater share of exports to China than the US, has been pursuing a policy of “de-risking” rather than decoupling. However, European Commission President Ursula von der Leyen hinted on Tuesday that the EU would join the US in imposing tariffs on Chinese goods.
“Should [it] be confirmed what I suspect, that such [Chinese] subsidies exist, then I can guarantee that the level of the duties we would impose is correspondent to the level of damage,” she said referring to an EU investigation into alleged state subsidies into the automotive industry in China.
Beijing has said it will retaliate against any tariffs with potential duties on products including French brandy, EU wine and dairy products.
Russian President Vladimir Putin, during his recent two-day trip to China, suggested that the US had imposed tariffs on Chinese-made EVs because they had improved in quality.
He suggested that Washington wanted to prevent strong competitors from entering the American market, and described the US approach as “unfair competition.”
Chinese officials have repeatedly denounced US trade and tech policy, describing it as “economic bullying.”
