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WASHINGTON – Treasury Secretary Janet L. Yellen on Thursday called for a “constructive” and “healthy” economic relationship between the United States and China, where both countries can work together to face global challenges despite conflicting national security interests. .
Yellen’s comments, delivered at Johns Hopkins University’s School of Advanced International Studies, were among the most comprehensive articulations by a Biden official of the administration’s stance toward China. The speech struck a pragmatic but mainly positive tone after months of tensions between the two countries, including over espionage operations and China’s influence in the United States.
Mrs. Yellen stressed the importance of securing America’s national security interests, as well as protecting human rights. But he also said the United States is secure enough in global economic leadership to accept economic competition from China, as long as the country plays by international rules.
“China’s economic growth does not have to match US economic leadership,” he said, adding, “We are not seeking to ‘decouple’ our economy from China.”
He said the Biden administration’s economic strategy focuses on investing in American infrastructure, clean energy and manufacturing technology, “not reducing or containing the rest of the economy.” And he urged China to work with the United States on challenges like helping indebted nations and mitigating climate change.
Scott Kennedy, a senior adviser at the Center for Strategic and International Studies, said the speech was “discordant with the general mood in Washington and Beijing that the US and China are destined to divide and fight each other.”
Mrs. Yellen expressed positive reasons for having a commercial relationship with China in a way that no previous Biden administration had, Mr. Kennedy said. “In doing so, the current administration has clearly differentiated itself from the Trump administration in its approach to China.”
Mrs. Yellen’s appeal for cooperation may have sounded unremarkable a decade ago, but his attitude in Washington towards China has become significantly more worried in recent years.
Republicans, as well as Democrats, now portray China as a dangerous economic rival and security threat. Many have lost patience with the idea of bringing China into the rules-based international system, arguing that past attempts to do so have failed to sufficiently improve the country’s practices.
Trump administration officials are encouraging a push toward “decoupling” the U.S. and China economies, despite having signed a trade agreement with the country. The Biden administration is taking a more targeted approach, focusing on preventing China from accessing technology with military applications and reducing America’s dependence on China for critical products like solar panels and car batteries.
Relations have been strained since February, when a Chinese spy balloon flew over the United States and sparked a diplomatic blowout. Tensions also remain high over Taiwan, which China claims as its territory, and China’s close partnership with Russia.
A prospective visit to China earlier this year by Secretary of State Antony J. Blinken was canceled after the fracas over spy balloons. Yellen said she plans to travel to China “at an appropriate time” to engage in “a substantive dialogue on economic issues.” Commerce Secretary Gina Raimondo is also exploring the possibility of a visit this year.
Jonathan Ward, author of “The Decisive Decade,” about U.S. competition with China, said it was “time to move on from the illusion” that China could be a responsible economic partner for the United States.
Economic relations with China create vulnerability by increasing US dependence on China, as well as transferring the country’s technology and capital to bolster its military, he said.
But Mrs. Yellen explained Thursday that she and President Biden do not see the US-China relationship through this frame, as a zero-sum contest “where one must fall for the other to rise.”
“We believe the world is big enough for both of us,” he said.
Mrs. Yellen also said that the United States is not trying to damage China’s economy, and that the actions that the United States is targeting against China – such as cutting off some of the world’s most advanced semiconductors – are aimed only at protecting US national security. .
He added that the Biden administration is considering more restrictions on China, including a program to limit certain US investments in the country in technology that could be used for surveillance or warfare. And he warned China against providing material support for Russia’s war in Ukraine, saying the consequences of violating US sanctions against Russia “will be severe.”
The Biden administration has restricted business with China for certain advanced technologies, even aggressively subsidizing the manufacturing of semiconductors, clean cars and solar panels in the United States to build alternative industries to China. China has criticized the US bans, saying they are illegal and a blatant attempt to damage China’s economy. The Chinese embassy did not immediately respond to a request for comment on Thursday.
“These national security actions are not designed to gain a competitive economic advantage, or to interfere with China’s economic and technological modernization,” Yellen said.
Ling Chen, an assistant professor of political economy at the School of Advanced International Studies, said the “main challenge” with this approach is separating areas of economic development that pose a threat to national security from those that do not. He notes that China makes more basic computer chips that are used in cars and toasters but also in tanks and weapons.
“The potential problem is that we live in a world where security problems and economic problems are increasing. It is very difficult to separate them,” said Ms. Chen.
However, he cited Ms. Yellen’s focus on cooperation. “No one wants to fight,” he said.
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