G7 finance ministers vow to take action against China's spare capacity
Date
5/26/2024 4:40:11 AM
(MENAFN) At the conclusion of their meeting in Stresa, Italy, on Saturday, the G7 finance ministers announced their intention to address the issue of China's surplus production capacity, which has been accused of flooding Western markets with low-cost products due to substantial government support. In their final statement, issued after a three-day meeting, the ministers expressed concerns about China’s extensive use of non-market policies and practices. They emphasized that these practices harm workers, industries, and economic resilience in their respective countries.
US Treasury Secretary Janet Yellen, speaking earlier on Thursday, urged the G7 to present a "clear and united front" against China’s excess industrial capacity. She highlighted that this surplus was creating macroeconomic imbalances and called on affected countries to respond appropriately. In line with this, the G7 finance ministers committed to continuing to monitor the potential negative impacts of China's excess capacity. They plan to implement measures to level the playing field in accordance with World Trade Organization principles.
In mid-May, the United States significantly increased customs duties on approximately USD18 billion worth of Chinese products, including electric cars, their batteries, and essential metals exported by China. The European Commission has similarly accused China of damaging the European market by flooding it with low-cost products. Following previous actions on cars, railways, and solar panels, Brussels launched an investigation in April into unfair practices targeting wind turbine manufacturers supported by Beijing. This investigation could potentially lead to the imposition of tariffs.
The coordinated stance by the G7 finance ministers underscores a growing international effort to counteract the economic imbalances caused by China’s production strategies, aiming to protect domestic industries and ensure fair competition in global markets.
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