China tariffs: Secretary Yellen talks Biden's 'targeted' approach

The Biden administration recently imposed tariffs on Chinese imports valued at $18 billion, focusing on sectors such as electric vehicles, solar panels, and steel. US Secretary of the Treasury Janet Yellen discussed these measures in an exclusive interview with Yahoo Finance's Jennifer Schonberger.

Yellen emphasized that the tariffs are being applied "in a very targeted way" to support industries that should maintain "a base of activity in the United States." She acknowledges the country's reliance on China for certain goods and explains these tariffs aim to reduce this dependence while redirecting production back to America.

"It's something we think is important for job creation and for our security," Yellen told Yahoo Finance.

Watch Yahoo Finance's full interview with US Secretary of the Treasury Janet Yellen here

This post was written by Angel Smith

Video transcript

I want to ask you about tariffs.

The administration levied new tariffs on $18 billion of Chinese imports back in May.

Does the administration think that tariffs could be a bigger tool in the toolbox when it comes to economic policy?

So we're trying to use them in a very targeted way.

Um, we've made a conscious decision not only the administration but also Congress, that there are industries that are strategic, that we think it's important to have a good base of activity in the United States.

And I'm thinking, particularly of semiconductors and also clean energy related, um, items, whether it's electric vehicles, batteries, solar panels, um, wind turbines.

At the moment, we are heavily heavily dependent on China for most of these things.

And China is following a strategy in which they are heavily subsidising their industry to build capacity, and they've invested to the point of massive overcapacity.

So, um, China, for example, has enough capacity to produce solar panels that it will exceeds entire global demand.

Um, we have made you know we have incentives for domestic producers to, um engage in this activity in the United States.

It's something we think is important for job creation and for our security supply chain resilience.

And so we wanna protect, uh, this aspect of, um, our industry from what really amounts to Chinese dumping.

So, um, that's an area where we think there's a clear justification for protecting our industry with tariffs, and we're not the only country that feels that way.

Um, many European countries, um, and others, including developing countries, are really suffering from this Chinese strategy of producing over capacity.

But President Biden is not proposing to put any broad based tariffs, um, in place, um, doesn't see that as a strategy that's, uh, desirable.

And, uh, you know, with respect to China, he hasn't removed the tariffs that Trump put in place.

But aside from what I mentioned mentioned, these areas hasn't increased tariffs.