- Yellen’s visit is an attempt to mend ailing US-China relations
- “Sufficient leeway” for US and China to engage in trade
- Yellen: Misunderstandings could affect financial and economic relationships
BEIJING, July 8 (Reuters) – US Treasury Secretary Janet Yellen on Saturday called for closer communication between China and the United States to improve economic decision-making and urged China to join global initiatives to help poorer countries cope to help climate change.
Despite bilateral tensions, record-breaking US-China trade over the past year has shown that there is “sufficient room for maneuver” for trade and investment, and that it is crucial to focus on areas of common interest and address disagreements through dialogue, Yellen told Chinese Premier He Lifeng at the start of a meeting.
According to a Treasury Department official, the meeting lasted about five hours and was followed by dinner.
Yellen’s visit on Sunday is Washington’s latest attempt to restore ties between the world’s two largest economies, which have been battered over issues ranging from Taiwan to technology that have drawn their allies into their rivalry and impacted business and trade ties.
Like US Secretary of State Antony Blinken, who made his first visit last month during Joe Biden’s presidency, Yellen is seeking a delicate balance between reconciliation and continued pressure on Beijing to end practices Washington says are harmful to US and American citizens Western companies are.
Both sides have downplayed expectations of breakthroughs while welcoming the chance for open face-to-face diplomacy.
“Given the complicated global economic outlook, there is an urgent need for close communication and exchange of views on our responses to various challenges for the two largest economies,” Yellen told He, China’s recently appointed economic czar.
This could “help both sides better understand the global economic outlook and make better decisions to strengthen our economies,” she said.
At the same time, Yellen reiterated that Washington wanted to ensure healthy competition with a “fair set of rules” that would benefit both countries over time.
When he met her at the Diaoyutai state guesthouse, where foreign dignitaries are often received, he said he was willing to work with Yellen.
Yellen told a group of women economists on Saturday that she is “in Beijing at this critical time because, despite all the disagreements between our nations, President Biden and I believe it is in the best interests of our peoples to improve our ties.” and maintain open and honest communication.
“I firmly believe that the relationship between our two countries is based on the solid relations between the American and Chinese people. It is important that we continue to nurture and deepen these relationships, especially as China reopens after three years of COVID lockdowns.”
China’s economy failed to recover as strongly as expected, raising the risk of a global slowdown.
[1/5]U.S. Treasury Secretary Janet Yellen (left) speaks as Chinese Vice Premier He Lifeng (right) listens during a meeting at the Diaoyutai State Guesthouse in Beijing, China, Saturday July 8, 2023. Mark Schiefelbein/Pool via REUTERS
“Meet China Halfway”
As the US seeks to reengage at all levels, Beijing has repeatedly urged Washington to walk the talk, citing ongoing US efforts to restrict Chinese access to technologies, including semiconductors.
Beijing has also refused to resume bilateral military ties while tariffs on Chinese products imposed during a trade war under Biden’s predecessor, Donald Trump, remain intact.
China this week abruptly announced export controls on two metals commonly used in semiconductors and electric vehicles in the name of protecting its national security and interests.
Still, recently appointed Premier Li Qiang left the door open for further dialogue, urging Yellen on Friday to “meet China halfway” as both sides would bring “positive energy” to the bilateral relationship.
Despite discussions of economic decoupling between the US and China, which both countries oppose, the data show a fundamentally solid trade relationship, with mutual trade reaching $690 billion last year.
The United States would continue to directly voice its concerns about specific economic practices and take targeted action to protect its national security, Yellen said.
She urged China not to allow any disagreements “to lead to misunderstandings, particularly those stemming from a lack of communication, which may unnecessarily deteriorate our bilateral economic and financial ties.”
Yellen told government officials and climate experts on Saturday that China is poised to help the world deal with the “existential threat” of climate change.
Beijing and Washington must take the lead in helping poor countries meet their climate goals and manage the impacts of climate change, she said at a roundtable.
Working together on climate finance is a “critical” responsibility “of the world’s two largest greenhouse gas emitters and the largest investors in renewable energy,” she said.
China, classified as a developing country by the United Nations, has long said it is the responsibility of developed countries to help poor countries fund to fight climate change.
But Beijing says it can contribute to “losses and damage” from climate change on a voluntary basis.
Reporting by Andrea Shalal; writing by Ryan Woo; Edited by Chizu Nomiyama and William Mallard
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