Yellen Seeks To Soothe Strained Relations in Visit to Communist China

The treasury secretary won’t meet with President Xi, but will see Premier Li Qiang as part of efforts to improve relations that are at their lowest level in decades due to disputes over security, technology, and other irritants.

AP/Shuji Kajiyama, pool, file
Secretary Yellen at Niigata, Japan, May 11, 2023. AP/Shuji Kajiyama, pool, file

BEIJING — The treasury secretary, Janet Yellen, plans to tell Chinese officials that Washington wants healthy economic competition but will defend trade curbs imposed by America on security grounds and express concern about Beijing’s export controls on metals used in semiconductors and solar panels, a senior Treasury official said Thursday.

Ms. Yellen was due to meet Friday with Communist China’s number two leader, Premier Li Qiang, as part of efforts to revive relations that are at their lowest level in decades due to disputes over security, technology, and other irritants. Treasury officials have said she wouldn’t meet with President Xi.

Washington doesn’t support decoupling or disconnecting American and Chinese industries and markets, and Ms. Yellen will reiterate that message, the Treasury official said. Business leaders have warned that might harm innovation and growth as both governments tighten controls on trade in technology and other goods deemed sensitive.

Ms. Yellen planned to discuss “targeted action” by Washington on trade due to national security or human rights concerns, according to the official, who briefed reporters on condition of anonymity.

Her visit follows one by the secretary of state, Antony Blinken, who met Mr. Xi last month in the highest-level American visit to Beijing in five years. The two agreed to stabilize relations but failed to agree on improving communications between their militaries.

Major agreements aren’t expected to come out of the meetings between Ms. Yellen and Chinese officials this week, says a senior advisor at the Center for Strategic & International Studies in Washington, William Reinsch.

Rather the hope of restarting dialogue between the two nations is the goal. “The best you can hope for this time around would be if the Chinese agree to some kind of structure for continuing economic conversations,” he said.

China’s government has been frustrated by American curbs on Chinese access to advanced processor chips on security grounds. That threatens to delay or derail the ruling Communist Party’s efforts to develop telecoms, artificial intelligence, and other technologies.

Mr. Xi accused Washington in March of trying to hamper China’s development.

Washington doesn’t use security-related restrictions for economic benefit and considers national security “non-negotiable,” the treasury official said.

America wants “healthy economic competition” with China but considers some of Beijing’s trade practices unfair, the official said. They said Ms. Yellen would detail those concerns in meetings with Chinese officials.

The official cited this week’s announcement of Chinese export controls on gallium and germanium as an example of policies about which Washington wants more information. The announcement jolted South Korea and other countries whose industries use Chinese supplies of the metals.

Washington wants to “promote resilient supply chains” and guard against excessive reliance on suppliers in critical areas but doesn’t consider that to be decoupling, the Treasury official said.

A senior Asia-Pacific international relations policy specialist at the Institute for China-America Studies in Washington, Sourabh Gupta, said the American argument that targeted restrictions are coming from a national security standpoint and not an economic competitiveness one isn’t expected to convince the Chinese government but may provide further assurances that more communication between the countries is desired.

“It does help create a certain reassurance that at least the U.S. is looking for a good relationship,” he said.

Ms. Yellen said earlier the two governments “can and need to find a way to live together” in spite of their strained relations over geopolitics and economic development.

Treasury officials told reporters earlier in Washington the secretary wanted to focus on stabilizing the global economy and challenging Chinese support of Russia during its invasion of Ukraine.

The latest flareup came after President Biden referred to Mr. Xi as a dictator. The Chinese government protested, but Mr. Biden said his blunt statements are “just not something I’m going to change very much.”

Ties became especially testy after a Chinese surveillance balloon flew over America in February and was subsequently shot down.

Associated Press


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