The U.S. Treasury Secretary Scott Bessent stated that he will urge G20 member countries to reconsider their trade conditions with China in order to reduce global trade imbalances, and encourage Beijing to lessen its reliance on exports and shift towards more domestic consumption. He noted that China’s current massive trade surplus and export-led growth model are not sustainable.
On Sunday, Bessent, in an interview with Reuters before the G20 finance ministers’ meeting, mentioned that despite the “rapid improvement” in U.S.-China trade dynamics, the world still cannot withstand a flood of cheap Chinese goods into global markets.
“The world cannot have a China with a trade surplus of $1.2 trillion,” Bessent said. “China’s economy is quite weak, and they are trying to escape their troubles through exports, but they need to rebalance their economy.”
He mentioned that the U.S. has imposed high tariffs and directly banned the import of certain Chinese goods (including automobiles), restricting many Chinese products from entering the American market. This has also pushed China to shift more exports towards other markets, particularly in Europe and Latin America.
Bessent believes that other countries need to take measures to incentivize China to adjust its economic model, encouraging Beijing to reduce its reliance on exports and reinforce long-term weak domestic demand.
“Other countries around the world will have to reassess their trade conditions with China,” he said.
The G20 finance and central bank governors’ meeting is set to take place on Monday and Tuesday. Previously, the rapid growth of China’s exports has become a concern for European officials. A European official preparing to attend the meeting told Reuters that Europe hopes to discuss the issue of a large influx of Chinese exports threatening local industries, including the automotive sector.
With China experiencing long-term weak domestic demand, it is further ramping up exports of electric vehicles, semiconductors, and other goods. In July of this year, China’s total exports increased by 23.9% year-on-year.
Due to the imposition of high tariffs by the U.S., more Chinese goods are flowing into Europe, prompting calls within the EU for stricter restrictions on imports from China. However, in the face of long-standing international demands to cut industry subsidies, reduce export reliance, and boost domestic consumption, the response from Beijing has been lukewarm.
The International Monetary Fund (IMF) estimates that the Chinese yuan is undervalued by about 21%, which undoubtedly exacerbates global trade imbalances.
The U.S. Treasury Department has identified reducing trade imbalances as one of the key agenda items for this G20 economic meeting. A senior official at the U.S. Treasury Department stated that the issue stems from “distortionary government economic policies that hinder fair competition.”
In February of this year, when the U.S. Treasury Department released the 2026 G20 finance agenda, one of the priority areas was to “deepen the understanding of global over imbalances.”
The G20 was initially established as a forum at the leader level during the 2008 global financial crisis with the aim of taking measures to end the most severe economic recession since the 1930s.
The most recent significant collective action taken by the G20 was during the COVID-19 pandemic in 2020, when member countries agreed to inject an additional $5 trillion into the global economy to address job and income losses.