Treasury Secretary Janet Yellen told Chinese Premier Li Qiang on Friday that the United States is not seeking “winner-take-all” competition, in a visit to Beijing packed with talks aimed at stabilising fraught ties.
Ms Yellen’s four-day trip is her first to China as Treasury chief, and she is the second high-ranking US official to visit recently after Secretary of State Antony Blinken last month.
And on Friday, Ms Yellen underscored to Chinese Premier Li that the United States was not seeking an economic showdown.
“We seek healthy economic competition that is not winner-take-all but that, with a fair set of rules, can benefit both countries over time,” she told Mr Li at Beijing’s Great Hall of the People.
The United States has said it is seeking to “de-risk” from China by limiting the world’s second-largest economy’s access to advanced technology deemed crucial to Washington’s national security.
The US has blacklisted a number of Chinese companies to prevent them from accessing the most advanced chips while pushing its allies to follow suit.
But Ms Yellen underlined to Premier Li that while Washington would “in certain circumstances, need to pursue targeted actions to protect its national security”, that should not derail ties.
“We may disagree in these instances,” she said. “However, we should not allow any disagreement to lead to misunderstandings that needlessly worsen our bilateral economic and financial relationship.”
Mr Li said that Beijing could see the relationship recovering after a difficult period.
“Yesterday, the moment you arrived at our airport and left the plane, we saw a rainbow,” Mr Li said.
“I think it can apply to the US-China relationship too: after experiencing a round of winds and rains, we surely can see a rainbow.”
Ms Yellen has stressed during her visit that Washington was not seeking a “wholesale separation of our economies”.
“A decoupling of the world’s two largest economies would be destabilising for the global economy,” Ms Yellen told a meeting with representatives of US businesses at a session hosted by the American Chamber of Commerce in Beijing.
“And it would be virtually impossible to undertake.”
Ahead of Ms Yellen’s trip, Beijing unveiled new export controls on metals key to semiconductor manufacturing on national security grounds, in the latest salvo in the chips war.
The Treasury secretary Friday told American businesspeople Washington was “concerned” about the curbs.
‘Win-win’
Beijing has struck an optimistic tone about the visit despite the tensions, with China’s finance ministry saying on Friday that it would serve to “strengthen communication and exchange between the two countries”.
“The nature of China-US economic and trade relations is mutually beneficial and win-win, and there is no winner in a trade war or ‘decoupling and breaking chains’,” a ministry official said in a statement.
On Friday morning, Ms Yellen had a “substantive conversation” with her previous counterpart, former Vice Premier Liu He, as well as the outgoing governor of China’s central bank, Yi Gang, a US Treasury official said.
“They discussed the global economic outlook as well as the respective economic outlooks for the United States and China,” the official added.
Analysts said Ms Yellen’s visit could allow for a warming of ties.
“Yellen actually appears to be a more down-to-earth member of the Biden administration,” Tao Wenzhao, a fellow at the Chinese Academy of Social Sciences, told AFP.
“I think we welcome Yellen’s visit, and this on a functional level should allow both sides to warm up to each other,” he said.
“We are now reshaping, rebuilding China-US relations.”
‘Avoid misunderstanding’
In a tweet after arriving on Thursday, Ms Yellen said that although the United States would protect its national security when needed, “this trip presents an opportunity to communicate and avoid miscommunication or misunderstanding”.
The United States does not expect specific policy breakthroughs this time, but hopes for frank and productive conversations that can pave the way for future talks, a US Treasury official told reporters on Thursday.
But, they said, “especially if they’re things that we may disagree about, it’s even more important that we’re talking”.
Tensions soared earlier this year when the United States detected and then shot down what it said was a Chinese spy balloon after the craft traversed its territory.
Mr Blinken cancelled a visit to China over the incident but eventually travelled to the country in June.
During that trip, both sides agreed on the need to stabilise their relationship.
But Ms Yellen faces an uphill struggle in persuading officials in Beijing that US actions — such as tightened export curbs on high-end semiconductors — are aimed at safeguarding national security and not an attempt to stifle China’s economic rise.
