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4 Apr, 2024 20:42

China’s ‘incredible’ growth threatens American and EU economies – US trade chief

Beijing’s “non-market” policies should be rebuffed through appropriate “countermeasures,” Katherine Tai has said
China’s ‘incredible’ growth threatens American and EU economies – US trade chief

Market-based US and European economies are struggling to survive against China’s “very effective” alternative economic model, a top US trade representative has warned, according to Euractiv.

Katherine Tai told a briefing in Brussels on Thursday that Beijing’s “non-market” policies will cause severe economic and political damage, unless they are tackled through appropriate “countermeasures.” Tai’s remarks came as the EU-US Trade and Technology Council (TTC) kicked off in Leuven, Belgium.

”I think what we see in terms of the challenge that we have from China is… the ability for our firms to be able to survive in competition with a very effective economic system,” Tai said in response to a question from Euractiv.

The trade official described China as a system “that we’ve articulated as being not market-based, as being fundamentally nurtured differently, against which a market-based system like ours is going to have trouble competing against and surviving.”

Tai argued that unless the US and EU figure out a way to defend the way their economies work, “we know what’s going to happen … and it’s going to have significantly damaging economic and political outcomes for our systems.”

The US trade chief called for “defensive” policies such as tariffs, as well as measures that are “more on the offense,” including “incentive measures to correct for a market dynamic that is not playing out in our favor.”

She pointed to China’s high production of steel, aluminum, solar panels, and electric vehicles as specific causes of concern.

US officials have repeatedly labeled China as America’s top “competitor,” while tightening economic restrictions against the country. US tariffs on Chinese goods were hiked significantly under President Donald Trump, who launched the first volley in a tit-for-tat trade war that began in 2018. A similarly hostile approach has continued under his successor, Joe Biden, who has adopted several policies aimed at the Chinese economy.

Beijing has warned that such measures violate the principles of fair competition, and harm the stability of world trade. The US is challenged not by China, but by its own unwillingness to accept that another great power may be its equal, Beijing’s top diplomat, Wang Yi, said last month.

Tai admitted on Thursday that it is China’s “incredible” economic growth that is a key factor in the tensions between the two nations.