BEIJING
\nUS Treasury Secretary Janet Yellen on Friday called for market reforms in China and criticised the world\u2019s second-largest economy for its recent \u201cpunitive\u201d actions against U.S. companies and new export controls on some critical minerals.
\nYellen, who arrived in Beijing on Thursday said the moves underscored the need for \u201cresilient\u201d and diverse supply chains, and warned that the United States and its allies will fight back against what she called China\u2019s \u201cunfair economic practices.\u201d
\nYellen made the remarks to the American Chamber of Commerce in China (AmCham) after what a Treasury official called \u201csubstantive\u201d talks with former Chinese economy czar Liu He, a close confidante of President Xi Jinping, and outgoing top Chinese central banker Yi Gang. She is slated to meet later Friday with Premier Li Qiang.
\nYellen\u2019s trip is part of a flurry of visits aimed at calming tensions between Washington and Beijing that escalated after the U.S. military shot down a Chinese government balloon over the United States and amid increasing strains over export controls.
\nNo major breakthroughs are expected, with officials from both sides accepting that safeguarding national security interests now trumps deepening economic ties.
\nChina hopes the U.S. will take \u201cconcrete actions\u201d to create a favourable environment for the healthy development of bilateral economic and trade ties, China\u2019s finance ministry said in a statement on Friday.
\n\u201cNo winners emerge from a trade war or from decoupling and \u2018breaking chains\u2019,\u201d the statement added.
\nU.S. firms in China hope Yellen\u2019s visit will ensure trade and commercial lanes between the two economies remain open, regardless of the temperature of geo-political tensions.
\nAmCham President Michael Hart welcomed Yellen\u2019s \u201cextra firepower\u201d in pressing for changes in China\u2019s policies.
\n\u201cYellen\u2019s visit is significant because it allows more conversations to happen, it allows more mid-level folks from both sides to come,\u201d he said.
\n\u201cI think if there was another year of no visits by top U.S. government leaders, the market would get colder,\u201d he added.
\nTeeing up possible biden-xi meeting
\nThe U.S. diplomatic push comes ahead of a possible meeting between President Joe Biden and Xi as soon as September\u2019s Group of 20 Summit in New Delhi or the Asia-Pacific Economic Cooperation gathering scheduled for November in San Francisco.
\nSecretary of State Antony Blinken traveled to Beijing last month and agreed with Xi that the mutual rivalry should not veer into conflict, and Biden\u2019s climate envoy John Kerry is expected to visit later this month.
\nYellen said she came to work toward a \u201cstable and constructive relationship\u201d between the two countries, while making clear that Washington will act to protect its national security interests and human rights.
\nRegular exchanges could help both countries monitor economic and financial risks at a time when the global economy was facing \u201cheadwinds like Russia\u2019s illegal war in Ukraine and the lingering effects of the pandemic,\u201d Yellen added.
\nYellen said she would make clear to Chinese officials that Washington was not seeking \u201ca wholesale separation of our economies,\u201d but raised concerns about their use of expanded subsidies for state-owned enterprises and domestic firms, barriers to market access for foreign firms, and recent \u201cpunitive actions\u201d against U.S. firms.
\nYellen said Washington was still evaluating new Chinese export controls on gallium and germanium, critical minerals used in technologies like semiconductors, but said the move underscored the need for \u201cresilient and diversified supply chains.\u201d
\nMarket reforms
\nYellen also took aim at China\u2019s planned economy, urging Beijing to return to more market-oriented practices that had underpinned its rapid growth in past years.
\n\u201cA shift toward market reforms would be in China\u2019s interests,\u201d the former top U.S. central banker told the U.S. business executives.
\n\u201cA market-based approach helped spur rapid growth in China and helped lift hundreds of millions of people out of poverty. This is a remarkable economic success story.\u201d
\nYellen noted that China\u2019s enormous and growing middle-class provided a big market for American goods and services, and stressed that Washington\u2019s targeted actions against China were based on national security concerns.
\n\u201cWe seek to diversify, not to decouple,\u201d she said. \u201cA decoupling of the world\u2019s two largest economies would be destabilizing for the global economy, and it would be virtually impossible to undertake.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
BEIJING US Treasury Secretary Janet Yellen on Friday called for market reforms in China and criticised the world\u2019s second-largest economy for its recent \u201cpunitive\u201d actions against U.S. companies and new export controls on some critical minerals. Yellen, who arrived in Beijing on Thursday said the moves underscored the need for \u201cresilient\u201d and diverse supply chains, […]<\/p>\n","protected":false},"author":2,"featured_media":341903,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"class_list":{"0":"post-342106","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-world"},"yoast_head":"\n