Yellen Ends China Trip After 'Productive' Talks

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Facts

  • US Treasury Secretary Janet Yellen on Sunday concluded a four-day trip to China to help mend strained US-China ties, saying she held "direct, substantive and productive" talks with the PRC's new economic leadership, including Premier Li Qiang and central bank chief Pan Gongsheng.1
  • Noting significant disagreements over what she described as Beijing's "unfair economic practices," Yellen said the Biden admin. does not view China-US relations through the lens of a "great power conflict," insisting that "the world is big enough" for both countries to flourish.2
  • Days before Yellen's China visit, Beijing restricted exports of two key rare metals used in chipmaking — further intensifying the trade standoff between the two countries after Washington imposed new export curbs on advanced computer chips to China last October.3
  • Defending "targeted" US trade measures that Chinese leaders claim are aimed at damaging China's emerging tech industry, Yellen said Washington will listen to Chinese complaints about US curbs on technology exports and may "respond to unintended consequences."4
  • Following the talks, bilateral ties are now "on surer footing," Yellen said, also referring to Chinese concerns about an expected executive order restricting US foreign investment, adding that such an order would be limited in scope and implemented in a transparent manner.5
  • While Beijing and Washington agreed to keep communication channels open for economic talks "at all levels," the PRC Finance Ministry on Monday urged the Biden admin. to take "practical" measures concerning US sanctions against Chinese companies.6

Sources: 1CNN, 2Al Jazeera, 3Business Insider, 4NPR Online News, 5DW, and 6Reuters.

Narratives

  • Pro-China narrative, as provided by Global Times. Yellen's visit once again reveals the paradoxical character of US policy toward China. While Yellen underscored Washington's desire to improve relations, this will do little to change Washington's overall "decoupling" strategy. Bilateral relations are primarily based on deeds rather than words, and by seeing the PRC primarily as a strategic rival, the US will continue to block China's economic and technological rise for the sake of "national security." Unless Washington reconsiders its zero-sum approach, there is no escaping this dead end.
  • Anti-China narrative, as provided by FT. While Yellen's trip did not yield any concrete breakthroughs, the fact that she is the first US Treasury Secretary to visit China in four years is an important step forward. During her difficult mission, Yellen signaled that there is no contradiction in seeking to improve political and economic relations on the one hand and defending Washington's national security interests through targeted safeguards on the other. Beijing's recent punitive economic measures are unlikely to improve ties, but Washington welcomes China's efforts to discuss ways to de-escalate.

Predictions