Chinese Foreign Ministry: U.S. 'Chinese overcapacity' rhetoric purely economic coercion

The "Chinese overcapacity" rhetoric used by the United States contains its intention of curbing and suppressing China's industrial development and is purely economic coercion and bullying, Chinese Foreign Ministry spokesperson Lin Jian said on Friday.

Lin made the remarks at a regular press briefing in response to the U.S. continuing to hype up the rhetoric recently.

The "Chinese overcapacity" rhetoric is not a "new concept," Lin said, noting that the U.S. once called China's export of products with high quality and low prices to the world "overcapacity," and now it intends to put the same label on China's exports of new energy products.

In fact, exports of China's new energy vehicles account for a much lower proportion of production than those of countries such as Germany, Japan and the Republic of Korea, he said.

"The rhetoric seems to be an economic concept, but it is actually aimed at seeking a more favorable competitive position and market advantage for the U.S.," Lin said.

Using "overcapacity" as an excuse to adopt trade protectionist measures cannot solve its own problems but will damage the stability of the global industrial and supply chains and curb the growth of emerging sectors, said Lin.

"We urge the U.S. side to abandon its hegemonic mindset, keep an open mind, embrace fair competition and abide by international economic and trade rules to truly create a world-class, market-oriented and law-based environment for trade and economic cooperation," he said.

According to reports, U.S. President Joe Biden said the Chinese government has long subsidized Chinese steel companies to expand capacity, dumping the extra steel into the global market at unfairly low prices, during a speech in Pittsburgh, U.S., adding that the U.S. trade representatives are investigating China's steel and aluminum industry, threatening to adjust the tariff rate on steel and aluminum imports from China to three times the current rate.

In response, Lin said China is seriously concerned and strongly dissatisfied with the statement as it is inconsistent with the facts and damages bilateral economic and trade relations.

China's steel industry is mainly based on meeting domestic market demand and does not have any subsidy policies to stimulate exports, Lin said, adding that its impact on the international market is very limited.

However, the U.S. has provided hundreds of billions of dollars in discriminatory subsidies to its own industries and abused export control measures under the pretext of "national security" to hinder normal international trade in chips and other products, he said.

The development of China's related industries is the result of technological innovation and active participation in market competition by enterprises, as well as benefits from the country's complete industrial system and huge domestic market, Lin noted, adding that the U.S. blaming China for its own problems is contrary to economic principles and common sense.