G20 trade ministers split over China's industrial overcapacity

Berlin [Germany], October 5: Most trade ministers from the world's largest economies disagreed with calls to curb excess industrial capacity at a Group of 20 (G20) trade meeting that ended on Thursday, according to China's commerce ministry, a view that contrasts with a US statement that a "handful" of countries objected.
"The issues related to excess industrial capacity and forced labour have been highly controversial," a Ministry of Commerce spokesperson said in a statement on Sunday about the two-day G20 Trade Ministerial Conference in Milwaukee, Wisconsin.
Because most member states held differing views, the meeting failed to produce an outcome document on the relevant issues, the spokesperson added.
A statement from US trade representatives on Friday said that a "handful" of trade ministers rejected to creating a "pathway towards cooperative action" on excess capacity and "non-market" policies such as forced labour, without naming the involved countries.
The differing viewpoints from the US-chaired meeting mean that industrial supply will be the focal point of the second round of China-EU trade talks set for Thursday and Friday in Beijing.In addition to overcapacity and forced labour, trade representatives at last week's meeting - where the US set the agenda - also did not agree on a proposal to adjust the principles behind most-favoured-nation (MFN) status in world trade. They did make a joint statement denouncing the weaponisation of food through coercive measures.
For years, the US and European Union (EU) have been highlighting what they see as excess supply of some Chinese exports and have imposed various tariffs on the goods, varying from solar panels to electric vehicles.
China consistently pushes back on the claims. In late July, the commerce ministry said in an official statement that China's industrial subsidies and insufficient domestic demand did not necessarily lead to overcapacity, warning that protectionism would only disrupt global trade and supply chains and risk the long-term growth of the global economy.
In a separate statement on Friday, China's top international trade representative Li Chenggang said the country firmly objected to the issues of overcapacity and forced labour being used as pretexts for unilateralism and protectionism.
"China is open to dialogue and cooperation on industrial policy with all parties, enhancing mutual trust through strengthened policy coordination and facilitating the healthy and sustainable development of global industries," added Li, who was promoted last month from international trade negotiator at the Ministry of Commerce.
During the meeting in Wisconsin, Li also met or had brief talks with representatives from 11 member countries, according to the Friday statement.
On the MFN system, the Ministry of Commerce said most attending states believed that undermining the principle would seriously damage the very foundations of the multilateral trading system. A US statement, in contrast, said there was willingness among "an increasing number of members" to discuss how it could be improved.
For the coming G20 Miami Summit in mid-December, China was willing to work with the chair state and all members while sticking to consensus and collaboration, the ministry spokesperson said on Sunday.
Source: Qatar Tribune