Treasury Secretary Janet Yellen stated that the United States is considering various measures, including potential tariffs, on China’s green energy exports. Yellen emphasized the importance of creating a level playing field in the green technology space to ensure that domestic firms and workers have opportunities in these industries that will shape the future. The U.S. has expressed concerns about a surplus of subsidized Chinese clean energy products flooding international markets at discounted prices, affecting the competitiveness of American firms. The European Union is also investigating the possibility of imposing trade restrictions on Chinese electric vehicles.
The U.S. and its allies, including Japan and Europe, have criticized China’s practice of heavily subsidizing its firms and supporting them even when they are losing money. The U.S. has imposed tariffs on Chinese electric vehicle imports, introduced by the Trump administration over concerns of unfair trade practices. The Biden administration is reviewing these tariffs, which could potentially be increased in response to pressure from Republican lawmakers. China has called for a reduction in these tariffs, pointing out the constant innovations driving the rise of their EV industry and denouncing accusations of oversupply by the U.S. and Europe.
Amid concerns over Chinese technologies posing national security risks, the Commerce Department is investigating whether Chinese EV imports could jeopardize national security due to the collection of large amounts of data by “connected” car technologies. This scrutiny comes in the wake of broader skepticism around the national security risks posed by Chinese technologies. Washington has also targeted Chinese firms that are perceived to be aiding Russia’s military and its actions in Ukraine. Yellen emphasized that while China and Russia engage in extensive trade, any military support provided by China to Russia against Ukraine is unacceptable and could result in sanctions.
Yellen described the ongoing economic tensions between the U.S. and China, with the U.S. raising concerns about China’s industrial incentives and the need for fair competition in the green technology sector. She acknowledged the possibility of tariffs being imposed on Chinese electric vehicles, but noted that the EU has been hesitant to implement such measures due to its strong trade relationship with China. Notably, the Biden administration had considered reducing tariffs on Chinese EVs, but the possibility of an increase is being explored in response to external pressures.
China’s minister of commerce, Wang Wentao, defended his country against accusations of oversupply, attributing the success of China’s EV industry to constant innovations. Yellen mentioned Beijing’s desire to see tariffs on Chinese EV imports reduced, but the escalating tensions between the two nations have complicated the trade dynamics. The U.S. government is cautious about Chinese technological influence on national security, including the potential risks posed by data collection through connected car technologies. As the U.S. and China navigate these complex economic and geopolitical challenges, Yellen underscored the need for transparent communication and cooperation to address areas of mutual concern effectively.
