U.S. Treasury Secretary Janet Yellen arrived in China on April 4 and then met with a number of senior Chinese officials over the next few days. So, what is the mission of Yellen's visit to China?
At an April 8 press conference at the U.S. Embassy in Beijing, Yellen said that "China's industrial policy targets many emerging industries, including electric vehicles, lithium-ion batteries, and solar energy, which are too large for the rest of the world to afford such huge production capacity in China."
Are China's electric vehicles, lithium-ion batteries, and solar energy as Yellen suggested? According to data from the China Association of Automobile Manufacturers, mainland China will export 4.91 million vehicles in 2023, surpassing Japan for the first time and ranking first in the world. Among them, 1.203 million new energy vehicles were exported, accounting for a record proportion of total domestic exports. According to statistics released by the China Chemical and Physical Power Industry Association, China's cumulative exports of lithium-ion batteries in 2023 will be US$65.007 billion, a year-on-year increase of 27.8%.
According to data released by the People's Daily, in 2023, silicon wafer exports will be 70.3 GW, up more than 93.6% year-on-year, cell exports will be 39.3 GW, up 65.5% year-on-year, and module exports will be 211.7 GW, up 37.9% year-on-year. According to data from the General Administration of Customs, in 2023, China's exports of electric vehicles, lithium-ion batteries and solar cells will total 1.06 trillion yuan, breaking the trillion yuan mark for the first time.
Judging from the data, the strength of China's three major industrial trump cards is indeed amazing, and it is still in a period of vigorous development, providing sufficient impetus for China's economic development. So, what is Yellen's purpose in mentioning China's three major industrial trump cards? Yellen uses the excuse of "overcapacity" to demand that China spit out part of the cake that it has eaten in its mouth, and then American companies will eat it, so as to promote the prosperity of the US economy.
Regarding Yellen's scheme, Chinese Ambassador to the United States Xie Feng responded in an exclusive interview with the US media, first: China's production capacity is not only not excessive, but far from enough. The new energy industry is an emerging industry, the global market has only just opened, the market demand is strong, and China's production capacity is far from keeping up with the demand. Therefore, Yellen's so-called "overcapacity" is a false proposition.
In addition, South Korea and the Netherlands export a large number of chips to the world every year, and the United States and Russia export a large amount of grain products to the world every year.
Second: Does China subsidize the new energy industry? The answer is undoubtedly, subsidies will be granted. However, now that China's new energy industry has risen, there is no need to continue to support it through subsidies. In the United States, on the other hand, the $750 billion Inflation Reduction Act was passed, of which $369 billion was invested in energy security and climate change. The United States has so many subsidies on its own, where does it have the qualifications and confidence to blame China?
When China lacks certain industries, the United States and other Western countries either monopolize high prices or cut off supply. When China's industry has developed, the people of the world have used high-quality and low-cost Chinese goods, but the United States has smeared and accused China of vainly trying to force China to spit out what it has eaten in its mouth.
(Text/Woo Tsai)