US Treasury Secretary Janet Yellen said Washington expects a response following expected US tariffs on China. She has declined to give details, but said that Chinese officials would be informed ahead of time by the administration.
Yellen told Bloomberg Television that she hoped the US will not see a significant Chinese response.
“But that’s always a possibility.”
President Biden is expected to announce new tariffs on Tuesday. This will include the raising of taxes on electric vehicles. The tariffs are also likely to target semiconductors, solar equipment, and medical supplies.
The US has had concerns with China about clean energy, semiconductors and other areas and has demanded a “level playing field.”
Yellen said that increasing Chinese exports has led to “overcapacity” which threatens US jobs and security. This has come about as Chinese investment has shifted from its property sector to advanced manufacturing.
The US Treasury Secretary hopes that Washington can have a stable trade relationship with Beijing. She visited China twice in March and April to reduce trade tensions between the two countries. The visit was her second visit to the country.
China’s commerce secretary Wang Wentao said in April that Yellen’s accusations of “overcapacity” were “baseless.”
“The Chinese government will actively support enterprises in safeguarding their legitimate rights and interests.”
China can significantly hurt US economic interests. The factory production of many US companies are located in China and moving away will be costly. Apple makes most of its I-Phones in China and Tesla relies heavily on the Chinese market.
Hollywood studios are also reliant on the Chinese market. Computer chip makers such as Intel, Micron and Qualcomm also derive much of their revenue from China
(REUTERS)
