U.S.'s Yellen begins China visit with both sides locked in confrontation

[July 06, 2023]  By Andrea Shalal and Yew Lun Tian

BEIJING (Reuters) -U.S. Treasury Secretary Janet Yellen arrived in the Chinese capital on Thursday, beginning a four-day visit expected to focus on easing ties between the world's two largest economies, despite low expectations on both sides.

Yellen received a low-key welcome from a Chinese finance ministry official and the U.S. envoy to China, Nicholas Burns, as she stepped off a government aircraft just after a rainstorm brought some relief to an otherwise sweltering Beijing.

Both sides are sceptical that Yellen's visit will be able to take much heat out of U.S.-China ties, however, with officials accepting that both countries have placed safeguarding national security above economic ties.

"Especially if there are things that we may disagree about, it's even more important that we are talking," said a U.S. official travelling with Yellen, speaking on arrival in Beijing.

"I don't think it's fruitless, I will say that definitively."

Yellen will address "unfair" practices by China, including recent punitive actions against U.S. firms and market access barriers, the official added.

On Friday she will meet China's Premier Li Qiang and former economy tsar Liu He, who is widely seen as a close confidant of President Xi Jinping.

Chinese commentators cry hypocrisy over U.S. concerns over the country's trade practices, however.

"I wouldn't regard it as Janet Yellen is not welcome, but China cannot just swallow all the poison pills and continue to show a smile," said Wang Huiyao, the president of a thinktank, the Center for China and Globalisation, referring to U.S. sanctions on a growing number of Chinese firms.

Before Yellen's visit, Chinese analysts told state media that her April speech, which ranked securing the national security interests of the U.S. and its allies as the key plank of economic policy with China, did not inspire optimism.

Zhu Feng, a professor of international relations at Nanjing University, told the Global Times newspaper that Yellen's emphasis on national security meant the U.S. was unlikely to stop the "economic and technological suppression" of China.

U.S. Treasury Secretary Janet Yellen, walks after arriving at Beijing Capital International Airport in Beijing, China, Thursday, July 6, 2023. Mark Schiefelbein/Pool via REUTERS

Yellen will emphasise that the United States does not support decoupling and call for greater transparency by China on its new espionage law, as well as progress in resolving international debt distress, the U.S. official added.

Even though no major breakthroughs are expected, U.S. officials say Yellen will push to open new lines of communication and coordination on economic matters, and stress the consequences of supplying lethal aid to Russia, an assertion China has adamantly rejected.

When Chinese ambassador Xie Feng met Yellen in Washington on Monday, he urged the U.S. to "pay great attention" and move to tackle China's main concerns on the economy and trade.

Trade tariffs imposed by the Trump administration and sanctions against Chinese firms are the country's chief concerns, said Wu Xinbo, an American studies specialist at Fudan University, who is familiar with Beijing's thinking.

Yellen's long-anticipated trip comes weeks after a visit by Secretary of State Antony Blinken, who agreed with Chinese President Xi Jinping that the mutual rivalry should not veer into conflict, amid a freeze in talks between their militaries.

Both visits are seen as critical to improving communication after the U.S. military shot down a Chinese balloon over the United States.

They come ahead of a possible meeting between President Joe Biden and Xi at the Asia-Pacific Economic Cooperation gathering scheduled for November in San Francisco.

(Reporting by Yew Lun Tian and Andrea Shalal; Writing by Joe Cash; Editing by Clarence Fernandez)

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