Argentina has aligned itself with the United States and 13 other economies, including the European Union, in releasing a joint statement that advocates for measures to tackle structural excess capacity and production issues in critical manufacturing sectors. The statement, announced by the US Trade Representative’s office on Wednesday, was signed during a meeting of the Organization for Economic Cooperation and Development Trade Committee, subsequent to discussions at the previous week’s G20 trade ministers’ meeting in Milwaukee, Wisconsin.
The declaration cautions about industrial capacity that consistently surpasses global demand due to non-market policies and practices. While not explicitly naming China, the matter of surplus industrial capacity has historically been a significant point of contention between Beijing and the United States, as well as other leading economies. The signatories pledge to investigate excess capacity and production while collaborating through specialised sectoral platforms. Their initial focus will be on industries such as automobiles, electric vehicles, batteries, semiconductors, and solar panels.
The 15 signatories include Argentina, Australia, Canada, the European Union, France, Germany, India, Italy, Japan, Mexico, Poland, South Korea, Türkiye, the United Kingdom, and the United States. However, several significant G20 economies, such as China, Brazil, Indonesia, Russia, Saudi Arabia, and South Africa, opted not to participate. The United States has contended that surplus production maintained by non-market policies disrupts global markets and exerts pressure on producers in other nations. The new initiative urges participating economies to tackle policies and practices that sustain structural excess capacity.
