Janet Yellen criticises China’s ‘unfair, non-market’ economic practises.
The U.S. Treasury Secretary, Janet Yellen, and the Chinese Vice Premier, Liu He, talked about international trade and supply chains as well as other economic issues. The Biden administration is thinking about lowering tariffs on Chinese goods to stop inflation from going up too fast.
In a virtual meeting with her Chinese counterpart on Tuesday, Yellen “honestly” voiced her concerns about China’s “unfair, non-market” economic policies and Russia’s war in Ukraine, the US Treasury Department said in a statement.
During the call, the two sides also talked about the global economic outlook in light of rising commodity prices and problems with food security. The Treasury Department said the call was “frank and substantive” and part of efforts to “keep lines of communication open.”
Director of the Australia-China Relations Institute James Laurenson told Al Jazeera that Yellen’s comments don’t seem to add much to what other US officials have said.
“The question is what the US will do besides making the same accusations over and over again. Many experts in trade law say that the WTO is a good place to seek redress, but the US doesn’t seem very interested in the organisation. But more unilateral sanctions won’t change China’s policies, and even close US allies like Japan and Australia, which are still committed to the WTO and its processes, won’t praise the US for them.
After the call, China’s Ministry of Commerce said that the “practical and honest” talks were about the global economy and the stability of supply chains.
The ministry also said that China was worried about US tariffs and sanctions against Chinese firms. Both sides agreed to keep talking, the ministry said.
In a statement, the ministry said, “As the world economy faces tough problems, it is very important for China and the U.S. to improve their communication and work together on their macro policies.”
“Protecting the stability of global industrial and supply chains will help China, the US, and the rest of the world.”
The talks are happening at the same time that US President Joe Biden is thinking about whether or not to lower tariffs on Chinese imports. This would be part of an effort to keep prices from going up too fast, which is happening for the first time in more than 40 years.
Reports say that Biden’s cabinet is split on whether or not to lower tariffs. Some of these tariffs were put in place by former President Donald Trump, who tried to stop what he saw as unfair trade practises by China.
Yellen has publicly asked Biden to lower some tariffs, saying that they make “no strategic sense” and are “paid for by Americans, not by the Chinese.”
Deborah Elms, who started and runs the Asian Trade Centre in Singapore, said that the fact that officials from the world’s two largest economies continue to meet is a good thing.
“Tensions can’t be handled if people talk through the media instead of in person or through Zoom,” Elms told Al Jazeera.
“The US government’s position on China is and always has been that China engages in unfair trade. So, it’s not strange that Yellen would say the same thing again. What can be done about it is, of course, the big question. Talking is a good first step, but it won’t be enough. There will need to be more than just random talks between government officials.
At the G7 summit in Germany last month, US national security adviser Jake Sullivan said that Biden and Chinese President Xi Jinping were likely to talk in the coming weeks.
Gary Ng, a senior economist at Natixis in Hong Kong, said that even if the US and China talk or lower their tariffs, they are unlikely to stop their growing rivalry.
“Tariffs could be rolled back on some products, but the US is still worried about the role of government subsidies and the progress of making its firms in China more competitive,” Ng said.
“These are structural questions about whether US companies are treated the same as their Chinese counterparts. The answers to these questions affect not only market access in China but also competition around the world.” The talks may make people feel better in the short term, but they don’t change anything about the strategic competition between the US and China.