Thursday, September 21, 2023

Yellen’s visit reopens communication between China and the US, but differences continue

US Treasury Secretary’s visit to China Janet Yellenresulted in high-level meetings to improve communication between the two countries, especially in the economic area, although both sides recognized that there are still important differences in their relations.

In her four days in the Chinese capital, Yellen met with the main people in charge of the economic policy from the Asian country, including the Prime Minister, Li Qiang; the new head of the Chinese Communist Party (CCP) at the People’s Bank, Pan Gongsheng; Finance Minister Liu Kun or Vice Premier He Lifeng.

In all interactions, rated by both as “frank and productivethe two sides emphasized the need to “avoid misunderstandings” and try to put their battered relationship on track, calling on them to continue maintaining “dialogue and exchanges”, although both Yellen and Chinese officials acknowledged that there are broad disagreements.

The Chinese side bluntly expressed its concerns “because of the US sanctions and its restrictive measures against China”, while Yellen criticized Beijing’s “unfair practices”, citing, among others, “existing barriers to accessing its markets”, and clarified that Washington will continue to take “specific measures for reasons of national security”.

At the negotiating table they planned the restrictions that the US imposed last year on the export of semiconductors and American-made materials, a measure called to limit Beijing’s ability to manufacture parts necessary for the operation of supercomputers or advanced military systems.

Restrictions to which others could be added to exports of artificial intelligence chips to China, according to the US press, to which Beijing responded this week with limitations on the export of gallium and germanium, two key metals for the manufacture of semiconductors, a product that is at the center of commercial and technological tensions between the two.

“Abusing the concept of National security it is something that the only thing it achieves is to damage economic and commercial exchanges ”, accused the Chinese state agency Xinhua after the meeting on Saturday between Yellen and He, evidencing the disagreements.

The Secretary of the Treasury, for her part, also brought to the fore the latest “punitive measures against American firms”, in reference to the investigations launched in China against several American consultancies or the prohibition of the American technology company Micron from selling products to Chinese clients.


The Chinese press stresses this Sunday that “it is the United States that must work with China” for relations to return “on the right path”although they acknowledge that US officials are making “efforts” to improve contacts.

“It is a positive sign for the world, which urgently needs the two big economic powers global partners to talk and cooperate in the face of ever greater challenges. But it is necessary for Washington to be true to its words”, commented in this regard the official newspaper Global Times in an editorial.

According to academic Gao Lingyun, from the Chinese Academy of Sciencesthe economic relations between the two “served for a long time as a stabilizing factor”, but the problem now is that the two powers compete at the same time that they show their dependence, which makes it so difficult to reach “significant” agreements.

Yellen herself acknowledged that the US “does not seek to disassociate itself economically from China” because that would be “disastrous” and “destabilizing” for both: “Seeing both parties sitting at the table is good in itself. But for the US to sanction China while expressing ‘concerns’ is a bit of a stretch. It only serves them to justify their measures, which have the objective of damaging China’s development,” denounces Gao.

And while Yellen asked to compete but “under some rules”Vice Premier He confessed that the Chinese side regrets the “unexpected incidents that damaged ties in recent months”, in apparent reference to the episode of the alleged Chinese “spy” balloon that flew over the United States at the end of January and fell on water Atlantic on February 4.

That episode seemed to destroy the rapprochement between the presidents of both countries, Joe Biden and Xi Jinping, during their meeting in November 2022 on the sidelines of the G20 summit in Bali.

Yellen’s visit followed the one made in June by Secretary of State Antony Blinken, who also emphasized “the importance of keeping communication channels open in all areas to reduce the risk of miscalculation” in an attempt to lower tension between the two powers and prevent competition from leading to open conflict.


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