On June 7, Mr. Zhou Kan, Chargé d'Affaires ad interim of the Chinese Embassy published an article entitled “Such ‘Overcapacity’ Could Be More Times Over”. The full text is as follows:

Recently, some US politicians accuse China on many occasions of “overcapacity”, and impose new tariffs on Chinese imports such as EVs and chips. It seems logical as they claim China’s “overcapacity” out of investment in emerging industries poses a "great risk" to the US and other countries. However, it is a fallacy to anyone with basic knowledge of economics. Or in other words, it is just the latest version of "China threat" hyped up by some in the US.

Why? Let's start with two facts:

First, what kind of capacity does the US claim to be "excess"? It is China’s new energy industry, including EVs, lithium batteries, and photovoltaics. But wait, aren’t these precisely the green and high-quality capacities that all countries need and pursue? Aren’t these industries the new driving forces for post-pandemic recovery? China indeed grows rapidly in these areas in cooperation with many countries, especially developing countries. The thing is, exports and investment in relevant industries provide high-quality, cost-effective, cutting-edge green products to the world and help with industrial upgrade and employment in many countries. The so-called "overcapacity" is actually high-quality capacity improving people’s lives and global growth.

Second, is the so-called "overcapacity" really excess? In definition, overcapacity means a industry’s total production capacity far exceeds market demand. Statistics do not support such allegation against China. According to the International Energy Agency, to achieve carbon neutrality, the world needs to sell 45 million EVs by 2030, more than three times the figure in 2023. Global demand for power batteries will reach 3500 GWh by 2030, more than four times the global shipment in 2023. Both exceed current global supply capabilities by a huge margin. These high-quality, advanced capacities are not excess but rather insufficient.

With these two facts, the so-called China’s “overcapacity” is already groundless. Then more questions emerge. Why is there such false accusation? What kind of hidden agenda is behind?

China is called the “world’s factory” not just for a day or two, but for ten or twenty years. Why did they ignore China’s “overcapacity” when it was the largest source of US imports before? Why did they ignore China’s “overcapacity” when it had to export 1 billion shirts to buy one Boeing airplane and earned less than $10 for each iPhone assembled? Why do they suddenly notice China’s “overcapacity” when it is developing high-end industries?

The US accuses China of excessive exports of high-end industrial products. However, about 80% of the US-made chips are exported. About 80% and 50% of the cars made in Germany and Japan are exported. Boeing and Airbus passenger planes are mainly for export. Western countries can export high-end products. But when it comes to China, it is “overcapacity” and “dumping”. Why?

The answers are quite straightforward. It is all about the hegemonic tradition, the selfishness, and the inherent sense of superiority of the US and other Western countries. They think they are on the top of the world and do not allow any country to challenge or have the potential to challenge its position.

For long, some in the US enjoy doing one thing one time after another: labeling other countries, especially those with development potential under the disguise of the so-called democracy,human rights and rules, which is followed by suppressing, containing, and smearing. This time, it invented “overcapacity”. The purpose is to keep developing countries, including China, at the low end of the industrial chain. By doing so, the US and Western countries can go on with their superior life enjoying affordable primary products while earning huge profits from high value-added goods. They want to keep it that way forever.

But anyway, let them say whatever they want. What they say can by no means change the direction of human progress. What they say can by no means hold back the development of China or the collective rise of developing countries. What they say is only helpful for one thing: exposing their double standards and fear and anxiety of losing hegemony. China’s high-quality “overcapacity” is good for global growth. Such “overcapacity” could be more times over. We hope more developing countries could have such “overcapacity”, which will be a medal of honor for us and a blessing for the majority of the people.