U.S. Treasury Secretary Janet Yellen recently concluded a five-day visit to China, where she engaged with top Chinese academics, political, and financial leaders in Guangzhou and Beijing. Central to her discussions was the concern over China’s alleged overcapacity in green technology production and fears that Chinese exports might undermine U.S. interests.
But what exactly is overcapacity, and does China truly have an overcapacity issue in its burgeoning green technology sector?
Overcapacity refers to a situation where a country’s production capabilities exceed the demand for its products, leading to excess supply in the market. This can result in decreased prices, affecting global competition and potentially harming industries in other countries.
China has invested heavily in green technology over the past decade, becoming a global leader in renewable energy, electric vehicles, and battery technology. This rapid advancement has prompted concerns in the U.S. about the impact of Chinese exports on its own green tech industries.
To delve deeper into this issue, we spoke with several experts. Zhao Hai, director of International Political Studies at the National Institute for Global Strategy, suggests that China’s expansion in green technology is a natural progression of its commitment to combating climate change and should be viewed as an opportunity for global collaboration rather than a threat.
He Weiwen, senior fellow at the Center for China and Globalization, points out that the global demand for green technology is on the rise, and China’s production capacity is meeting a critical need. He argues that labeling it as overcapacity overlooks the global benefits of accessible green technology.
Paul Gillis, professor of accounting at Beijing International Studies University, emphasizes that market dynamics should dictate the flow of green technology products. He notes that protectionist measures could hinder innovation and slow down global efforts to address environmental challenges.
The question remains: Is the U.S. overreacting to China’s successful development in green technology? While concerns over market competition are valid, collaboration and mutual understanding may be more effective in addressing shared environmental goals.
Reference(s):
cgtn.com
