April 22, 2024

Yellen to Visit China for Top-Level Economic Talks

Treasury Secretary Janet L. Yellen will make her second trip to China this week for high-level talks aimed at further stabilizing the relationship between the world’s largest economies as political rancor in the United States intensifies ahead of the presidential election.

During four days of meetings in Guangzhou and Beijing, Ms. Yellen plans to meet with representatives from American companies, Chinese students and professors and China’s top economic officials. The trip comes as the Biden administration tries to balance a tougher stance toward China, including restricting access to American technology and retaining tariffs on billions of Chinese exports, while keeping regular lines of communication open and avoiding an economic war.

The Treasury Department announced the trip as President Biden and Xi Jinping, China’s leader, held a call on Tuesday on a variety of issues. In a statement after the call, the White House said that Mr. Biden raised concerns with Mr. Xi about China’s “unfair trade policies and nonmarket economic practices” that harm American workers and explained that the United States would continue to take steps to prevent Chinese access to advanced American technology that could threaten national security.

A senior Treasury Department official who previewed Ms. Yellen’s trip said that it was taking place in the spirit of responsibly managing the economic relationship between the countries.

But concerns are growing within the administration over China’s strategy of ramping up exports of green energy technology like solar panels and electric batteries.

The official said that the two sides are expected to have “frank” conversations about the Biden administration’s concerns about the impact of China’s excess industrial production on global supply chains for solar technology, electric vehicles and lithium-ion batteries. They are also expected to discuss the global economy, efforts to curb drug trafficking and how to work together to fight climate change.

In China, Ms. Yellen will meet with Wang Weizhong, the governor of Guangdong Province; Vice Premier He Lifeng; former Vice Premier Liu He; and Pan Gongsheng, the governor of the People’s Bank of China.

Ms. Yellen visited China for the first time as Treasury secretary last July. As an economist who has argued against the merits of tariffs, she was received well by Chinese officials who consider her a voice of reason within the Biden administration.

Engagement with China is particularly challenging during U.S. election years, when Democrats and Republicans typically ratchet up anti-China sentiment. This year has been no different, with former President Donald J. Trump proposing additional and even higher tariffs on Chinese imports and Republicans urging more restrictions on Chinese investment in the United States.

At the same time, the Biden administration has been considering tariffs on Chinese imports of green energy technology and watching with concern as Chinese companies increase investments in Mexico to gain greater access to the American consumer market.

The White House has also been scrutinizing the Chinese-owned social media platform TikTok and recently imposed sanctions on Chinese hacking groups. And the Treasury Department is in the process of developing a new program that would restrict outbound investments in certain Chinese sectors that the Biden administration believes could threaten American national security.

Ms. Yellen’s trip to China last year yielded little in the way of major breakthroughs. But it led to a formal structure to ensure ongoing communication. Treasury officials said that regular meetings between new economic and financial working groups would provide a format for both countries to communicate their policy concerns and help prevent relations from breaking down.

Mark Sobel, a former Treasury Department official, noted that the U.S. and China account for about 40 percent of global gross domestic product, making the relationship critical for the world economy. He suggested that beyond the macroeconomic issues, the two sides will discuss U.S. sanctions policy and the problem of low-income countries that owe debt to China.

Even if there are no major breakthroughs, Mr. Sobel said that the dialogue would still be important.

“Even if the two sides disagree, and there is much that can go wrong in U.S.-China relations these days, the talks will help limit misunderstandings and provide the other side with context,” Mr. Sobel said.

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