Besson urges G20 to re-examine trade conditions with China, saying China's export floods are unsustainable

U.S. Treasury Secretary Scott Bessent, ahead of the G20 meeting, said he would encourage other G20 members to rethink trade conditions with China to narrow global imbalances and push Beijing from a growth model heavily dependent on exports to more dependent on domestic consumption.

Reuters on August 31 that Bessent believes the current scale of exports from China is "unsustainable" despite the improvement of the direct trade situation between the United States and China, and he argues that other economies should also assess whether more trade barriers or policy tools need to be adjusted.

U.S. puts global trade imbalances on G20 agenda

Financial officials of the G20 gathered this week in Ashville, North Carolina.In addition to trade with China, the U.S. is also trying to push its members to discuss global growth, debt market pressures and business relations with Iran.

Bessent’s remarks show that Washington is trying to expand concerns about China’s export model from a bilateral tariff dispute to a multilateral economic issue, and his core argument is that China’s continued expansion of manufacturing exports, while domestic demand is relatively insufficient, will shift capacity and price pressure to other economies.

Trade barriers remain only policy arguments

What needs to be stressed is that the U.S. policy recommendations to G20 members do not mean that the G20 has made a unified decision, nor does it mean that other members will take the same action.

Countries have different trade dependencies, industrial structures, and inflation conditions with China. Europe, Asia and emerging markets, even if they are equally concerned about China’s manufacturing surpluses and trade imbalances, may adopt different strategies on tariffs, counter-subsidy investigations, local industry support or negotiations.

Beijing's economic re-balance pressure rises

Faced with real estate adjustments in recent years, insufficient consumer confidence and pressure on local debt, exports continue to play an important growth pillar in China's economy, while U.S. and some European policy makers believe that if China expands its exports to digest domestic production capacity, it may increase manufacturing and employment pressure in other countries.

China's officials have long opposed describing China's export competitiveness as "excess capacity" and accused the West of trade restrictions of protectionism, which represent Beijing's position, but can not replace independent analysis of subsidies, capacity, prices and trade data.

According to the editorial department of Focus China, Bessent’s introduction of China’s economic structures to the G20 agenda means that the international debate over China’s export model is shifting from a single-industry counter-subsidy case to a wider global imbalance and economic security issue.