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US "overcapacity" labeling clearly politically-motivated: SCMP commentary

Xinhua | Updated: 2024-04-11 17:12

High-rises dominate the skyline on both sides of the Huangpu River in Shanghai. [Photo by Gao Erqiang/China Daily]

The latest buzzword of Western media's China reporting, "overcapacity", is another addition to Washington's repertoire of criticism about China, which is clearly more motivated politically than economically, said a South China Morning Post article on Tuesday.

The commentary titled "China is not to blame for the snail's pace of US EV progress," written by Xin Wang, an associate professor of China Studies at Baylor University in Texas, US, said US Treasury Secretary Janet Yellen and US Trade Representative Katherine Tai had both expressed concerns recently about China's "overproduction" of electric vehicles (EVs), among other things, saying it would hurt US manufacturers and employees.

However, "it is the US market's high prices, not Chinese overcapacity, that hinder widespread EV adoption, given that Chinese EVs are completely excluded from the US currently," the article said.

In 2023, the EV share of the total US vehicle market was only 7.6 percent. The average price of a new EV in the US is around 50,000 US dollars. American consumers who can't afford such prices have limited choices. Meanwhile, China's largest EV maker, BYD, offers a subcompact, Seagull, for less than 10,000 dollars.

"China has long pursued EV development as a policy priority, in part to fight air pollution and lower carbon emissions," the commentary said. "Its primary market is its own market. Even with the rapid expansion of China's EV sector, fewer than 10 percent of cars in China are EVs. There is thus a much bigger market for EVs in China."

In contrast, the US is lagging in realizing even its EV infrastructure ambitions, and "China has nothing to do with this slow rollout."

According to the piece, in the United States, Republican states and fossil fuel companies have historically opposed EV development, while the United Auto Workers, a key Democratic constituency that has endorsed Biden for re-election, also has serious apprehensions about a shift to EVs.

"It seems evident that the comments from Tai and Yellen have been influenced by domestic political considerations, especially in an election year in the US, instead of economic concerns," the article noted.

The narrative of "overcapacity" also overlooks China's efficiency and work ethic, as exemplified by the rapid construction of Tesla's Gigafactory in Shanghai. "Local labour's dedication and alignment with institutional goals are the keys to China's unique approach to economic development, which US policymakers often fail to comprehend," the article said.

The commentary also refuted Western criticism that China is hurting other economies, as it actually has had a beneficial impact, particularly on economies in the Global South. "China's infrastructure projects have offered affordable solutions and fostered technological innovation in regions like Latin America, Africa, Southeast Asia and the Middle East," it explained.

The piece said nothing is new about US labeling other countries' production as "overcapacity" as similar scenarios happened in the 1980s between the US and Japan, reflecting the American mentality towards competition from ascending economies.

"Engaging in politically charged rhetoric only serves to exacerbate tensions and hinder efforts to mend ties and foster healthy business relations between the two countries," the article said.

"Instead of resorting to divisive rhetoric, fostering collaboration and recognizing China's contributions can pave the way for constructive dialogue and mutual understanding," it added.

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