BEIJING – United States Treasury Secretary Janet Yellen on Sunday expressed hopes that the relationship between her country and China will move to a phase where top-level diplomacy is a given, after a four-day visit to Beijing that aimed to restart communication.
She stressed that the US will continue to take targeted and transparent actions to diversify supply chains from China, but not to decouple the world’s two largest economies, which would be “disastrous for both countries and destabilising for the world”.
Bilateral meetings had appeared to be back on track in November 2022 when US President Joe Biden and Chinese President Xi Jinping held their first in-person talks in five years, but were derailed by an alleged Chinese spy balloon that flew over the US in February.
“No one visit will solve our challenges overnight. But I expect that this trip will help build a resilient and productive channel of communication with China’s new economic team,” Dr Yellen said. She had four days of meetings with top officials, including Premier Li Qiang, Vice-Premier He Lifeng and the People’s Bank of China’s party chief Pan Gongsheng.
“My hope is that we can move to a phase in our relationship where senior-level diplomacy is simply taken as a natural element of managing one of the world’s most consequential bilateral relationships,” she told reporters on the final day of her visit.
The trip was aimed at mending bilateral ties, with the two superpowers facing deep disagreements over issues from trade in high-end computer chips to Taiwan.
Dr Yellen described her bilateral meetings – which totalled 10 hours over two days – as a step forward to putting the relationship on a “surer footing”, and that they were “direct, substantive and productive”.
She said she discussed with her counterparts about China’s “unfair” economic practices, a recent uptick in “coercive actions” against American firms, national security and human rights.
China’s Ministry of Finance said on Sunday that Dr Yellen and Finance Minister Liu Kun exchanged views on topics such as the macroeconomic situation in China, US and the world; both countries’ fiscal policies; and dealing with global challenges. They had met at the Diaoyutai State Guesthouse.
Chinese officials had earlier voiced concerns to Dr Yellen over US restrictions on China. Among other things, Beijing had previously objected to controls imposed on the export of semiconductor manufacturing equipment.
The US will continue to take actions necessary to protect its national security interests and those of its allies, said Dr Yellen at a news conference, adding that these actions will be transparent, narrowly scoped and targeted to clear objectives.
“Importantly, these actions are motivated by straightforward national security considerations. They are not used by us to gain economic advantage,” she added.
Dr Yellen said the US wants a dynamic and healthy global economy that is open, free and fair – not one that is fragmented or forces countries to take sides.
Asked if her Chinese counterparts were convinced by this argument, Dr Yellen acknowledged that they had expressed scepticism and concern that de-risking amounts to decoupling.
“I felt that it was extremely important for me to address this issue and assure my Chinese counterparts that these are by no means the same thing… And I think they have certainly heard that this is something that I am trying to communicate and believe very strongly myself. Certainly, I think that message was received.”
Dr Yellen, an economist by training who was previously head of the Federal Reserve, is the second Cabinet-level member of Mr Biden’s administration to visit Beijing in a month.
In June, Secretary of State Antony Blinken made a two-day trip to Beijing – the first by a US secretary of state since 2018.
Climate envoy John Kerry is set to travel to China in July for talks on global warming. The talks were suspended when former House Speaker Nancy Pelosi visited Taiwan, which Beijing sees as a breakaway province awaiting reunification, in August 2022.
