US Treasury Secretary Janet Yellen will visit China again next year at her counterpart’s invitation, as officials in the world’s two biggest economies seek to boost contact further and improve tense relations.
Better communication “allows us to avoid misunderstandings and unintended escalation, make informed decisions, and work toward specific policy outcomes,” Yellen said Friday following two days of meetings in San Francisco with Vice Premier He Lifeng, China’s economic czar.
The Chinese side in a statement issued later in the day also said both parties agreed to “strengthen communication, seek consensus and control disputes so as to avoid misunderstanding and accidental escalation of friction.”
The Yellen-He encounter took place just a few days before a highly anticipated meeting between US President Joe Biden and Chinese President Xi Jinping. That will occur on the sidelines of next week’s Asia-Pacific Economic Cooperation forum in San Francisco, which the US is hosting for the first time since 2011.
Yellen said He told her he welcomed a return visit by her to China. The Treasury secretary first visited Beijing in her current capacity in July, making it the second trip there by a Biden administration cabinet member.
“I look forward to traveling there next year,” Yellen said at a press conference, citing the sides’ desire to continue a “regular cadence of contact” between the two counterparts.
Leaders of the two delegations agreed to carry out “direct communication” regularly, according to the Chinese statement attributed to the official Xinhua news agency and posted on the government’s website.
The talks between the two top officials touched on topics ranging from common global challenges to their individual economic outlook and areas of concern. While the two sides have sought to improve ties and reinstate dialogue — especially on economic issues — key points of friction remain.
No Decoupling
During their discussions, Yellen and He emphasized that the US and China are not seeking to decouple their economies, the Treasury Department said in a statement.
The Biden administration’s policy toward China is geared toward defending and securing national security while stressing that the US isn’t trying to hold China back economically — a message that Chinese officials have criticized, given US export controls enacted last year that are designed to deprive China of key technologies. In recent months, Washington has also unveiled a plan to vet outbound investments.
“We welcome the objective of a healthy economic relationship that provides a level playing field for companies and workers in both countries and benefits the two peoples,” Yellen said.
She added that she specifically raised US concerns about China’s export controls on critical minerals and graphite, used in the manufacture of high-tech goods such as semiconductors and batteries for electric vehicles.
“I stressed that companies must not provide material support for Russia’s defense industrial sector and that they will face significant consequences if they do,” Yellen said.
Chinese Concerns
China “explicitly expressed its concerns” about US restrictions on two-way investment, its sanctions against Chinese firms, export controls targeting the country and tariffs on Chinese goods, according to the government’s statement. China demanded “concrete action” by the US to address the grievances, it added.
While national-security issues have yielded tension between the two sides, Yellen identified some areas where the two nations could cooperate, including debt distress in poorer countries where China is the largest bilateral lender.
“Mitigating the debt problems of low-income countries with debt distress is an important objective not just for the US but for the G-20, the IMF and the globe,” Yellen said. “China as a major creditor needs to take part in that,” she said, adding that they have agreed to cooperate and to try to speed it up.
China’s He explained the government’s stance on Russia’s war in Ukraine and the Israel-Hamas conflict in response to US questions, according to the Chinese statement. The vice premier also met representatives from Chinese and American companies, it added, without naming any firms.
Liao Min, a vice minister at China’s Ministry of Finance, told reporters in San Francisco Friday that He met with Yellen for multiple rounds of talks totaling 10 hours with the intent of preparing economic results for the meeting between Xi and Biden, according to a government readout.
“The mutually beneficial cooperation between China and the US has strong momentum, solid foundations and broad space, but the premise is equality and mutual respect,” said Liao. The vice finance minister reiterated that “de-risking on the grounds of national security” violates basic economic principles and is not conducive to good relations.