US Secretary of the Treasury Janet Yellen said she told her Chinese counterpart that Beijing’s heavy financial support for certain industries could pose a threat to other nations, as trade tensions simmer between the world’s largest economies.
Speaking at a news conference in San Francisco on Monday following a day of meetings between finance ministers from across the Pacific Rim, Yellen said she discussed “issues of oversupply” with Chinese Vice Premier He Lifeng (何立峰).
“We did talk about issues of oversupply that have arisen and could arise in the future in industries that China is investing in very heavily,” Yellen said.
Photo: Bloomberg
“I do consider that a risk,” and Chinese officials should understand the US’ concerns that some of this investment could result in overcapacity, she said.
Yellen added that she discussed China’s growth slowdown with APEC ministers, who agreed that it presented a “downside risk to the economic outlook” particularly for member nations with strong trade ties to Beijing.
China and the US are committed to creating a “level playing field” for companies and workers in their nations, said statements the two sides released after their meeting at the start of the conference.
Finance officials held discussions in California ahead of a gathering of leaders from their nations later this week. The APEC summit is to also provide an opportunity for a much-anticipated meeting of US President Joe Biden and Chinese President Xi Jinping (習近平).
Yellen, who hosted her counterparts in the California city, said the finance ministers’ meeting allowed the group “to cement progress on key priorities: from monitoring macroeconomic and financial developments in the region and globally, to advancing our approaches to regulation of digital assets, sustainable finance, and inclusive growth-oriented policies.”
Chinese overcapacity in some sectors has been an issue for years, with the EU, Japan, the US and other nations working together in various formats to try to reduce this in sectors such as steel. The EU recently opened an investigation into Chinese subsidies for electric vehicles after Chinese exports jumped.
Semiconductor shares in China surged yesterday after Reuters reported the US had ordered chipmaking giant Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to halt shipments of advanced chips to Chinese customers, which investors believe could accelerate Beijing’s self-reliance efforts. TSMC yesterday started to suspend shipments of certain sophisticated chips to some Chinese clients after receiving a letter from the US Department of Commerce imposing export restrictions on those products, Reuters reported on Sunday, citing an unnamed source. The US imposed export restrictions on TSMC’s 7-nanometer or more advanced designs, Reuters reported. Investors figured that would encourage authorities to support China’s industry and bought shares
TECH WAR CONTINUES: The suspension of TSMC AI chips and GPUs would be a heavy blow to China’s chip designers and would affect its competitive edge Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, is reportedly to halt supply of artificial intelligence (AI) chips and graphics processing units (GPUs) made on 7-nanometer or more advanced process technologies from next week in order to comply with US Department of Commerce rules. TSMC has sent e-mails to its Chinese AI customers, informing them about the suspension starting on Monday, Chinese online news outlet Ijiwei.com (愛集微) reported yesterday. The US Department of Commerce has not formally unveiled further semiconductor measures against China yet. “TSMC does not comment on market rumors. TSMC is a law-abiding company and we are
FLEXIBLE: Taiwan can develop its own ground station equipment, and has highly competitive manufacturers and suppliers with diversified production, the MOEA said The Ministry of Economic Affairs (MOEA) yesterday disputed reports that suppliers to US-based Space Exploration Technologies Corp (SpaceX) had been asked to move production out of Taiwan. Reuters had reported on Tuesday last week that Elon Musk-owned SpaceX had asked their manufacturers to produce outside of Taiwan given geopolitical risks and that at least one Taiwanese supplier had been pushed to relocate production to Vietnam. SpaceX’s requests place a renewed focus on the contentious relationship Musk has had with Taiwan, especially after he said last year that Taiwan is an “integral part” of China, sparking sharp criticism from Taiwanese authorities. The ministry said
US President Joe Biden’s administration is racing to complete CHIPS and Science Act agreements with companies such as Intel Corp and Samsung Electronics Co, aiming to shore up one of its signature initiatives before US president-elect Donald Trump enters the White House. The US Department of Commerce has allocated more than 90 percent of the US$39 billion in grants under the act, a landmark law enacted in 2022 designed to rebuild the domestic chip industry. However, the agency has only announced one binding agreement so far. The next two months would prove critical for more than 20 companies still in the process
RSS