Beijing and Washington, DC Clash Over Excess Capacity: A Guide for the Bewildered

On 28 July 2026 China’s MOFCOM published a position paper on the trade-related aspects of excess capacity. This follows the initiation in March 2026 of a U.S. investigation into such matters as they relate to 16 trading partners, including China. That investigation may soon result in further import restrictions being imposed by the United States. By posing 10 specific questions about excess capacity, this note sheds light on the substantive disagreement between Beijing and Washington, DC on this salient trade policy matter.