Columnist: Blocking China's clean tech is against 200 years of economics

A Bloomberg columnist commented on Tuesday that U.S. Treasury Secretary Janet Yellen's recent threat of new tariffs or other trade actions concerning China's green energy goods exports is against 200 years of economics and the essence of it is protectionism, which is a "protectionist disaster" for both the U.S. and the world.

Yellen arrived in China on Thursday and just wrapped up her six days of meetings. During her visit, she complained that China's investments in clean technology are excessive, and fast-growing exports of these products threaten companies in the U.S. and other countries.

However, David Fickling, a columnist for Bloomberg criticized U.S. pressures on China's green energy product exports. He said any pressure would actually be restricting public access to affordable and clean technology.

"One of the most distinguished living economists is rejecting what's been one of the most fundamental principles of economics for more than 200 years: comparative advantage. If a country can manufacture goods at lower costs than you can, you shouldn't raise tariff barriers. Instead, you should import the goods, and send back something in return where your industry is more efficient," said Fickling.

He stated that clean technology such as solar panels, EVs and lithium-ion batteries only comprise a small share of China's exports, roughly 5.7 percent last year. China earned less export revenue from EVs in 2023 than from products such as suitcases, backpacks, furniture and toys.

The columnist pointed out that, when talking about climate change, Washington believes that the global new energy capacity is still insufficient. The U.S. and China agreed to triple renewable energy capacity globally by 2030 four months ago. However, when it comes to China's new energy industry, the U.S. accused it of "excess capacity," which the columnist believes is contradictory.

He said that in lithium-ion batteries and wind power, the world is drastically deficient, so Chinese companies' investment in them is vital for the world. 

"If China's clean-tech investments have become a perceived problem for the United States and the European Union over the past year, it's as much to do with the way that the political establishment and major domestic companies in those markets have quietly soured on the energy transition over the same period," said David Fickling. 

"The advantage of jawboning and unilateral tariffs like those being considered by the U.S. and EU is that they don't need to hold up to the rigor of trade law," said Fickling, adding, "In the absence of a functioning WTO, it's a neat way of painting anti-climate protectionism as green industrial policy."