China-US ties: Treasury Secretary Janet Yellen has ‘frank and productive’ discussion with ambassador Xie Feng ahead of Beijing visit

Yellen conveyed importance of the two largest economies working together on global challenges, including macroeconomic and financial issues, US side says
On Saturday, Xie told Biden that Beijing hopes the US will work with China to stabilise and bring their relationship back on track

US-China relations

Cyril Ip

Published: 2:55pm, 4 Jul 2023

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US Treasury Secretary Janet Yellen had a “frank and productive discussion” with Xie Feng, China’s envoy to Washington, ahead of her trip to Beijing to ease economic tensions between the two superpowers.

Yellen and Xie met in Washington on Monday in support of “ongoing efforts to maintain open lines of communication and responsibly manage the US-China bilateral relationship”, which was also the stated objective of Yellen’s trip to the Chinese capital from Thursday.

“Secretary Yellen raised issues of concern while also conveying the importance of the two largest economies working together on global challenges, including on macroeconomic and financial issues,” the Treasury Department said in a statement.

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The Chinese embassy said Xie asked the US to “attach great importance” to resolving trade and economic issues, which were China’s main concerns. Both sides saw the meeting as candid and constructive, and agreed to keep up communication, it said.

“A healthy and stable Sino-US relationship conforms to the common interests of both countries and is also the common expectation of the international community,” Xie said.

“It is hoped that the US and China will meet each other halfway, fully implement the important consensus of the two heads of state, use actions to eliminate interference, manage differences and strengthen dialogue and cooperation with sincerity … to promote Sino-US relations stabilising and a return to the right track.”

Observers said the long-awaited talks would touch on thorny trade issues, including Washington’s tech restrictions and tariffs on Chinese goods, with the financial departments of both sides finding ways to overcome political obstacles and promote financial cooperation.

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Yellen will be the second senior official from US President Joe Biden’s cabinet to visit the Chinese capital, following Secretary of State Antony Blinken’s fence-mending trip in June, when he met Chinese President Xi Jinping and senior diplomats, including Foreign Minister Qin Gang and Wang Yi, director of the Office of the Central Commission for Foreign Affairs.

Biden’s controversial reference to Xi as a “dictator”, a day after Blinken left the country, was described by Beijing as a political provocation, but Biden said his remarks had not undermined efforts to shore up strained relations with China and he expected to soon meet the Chinese leader.

Yellen’s trip is part of a series of meetings between Chinese and US officials expected this year as a freeze in ties – following an alleged Chinese spy balloon that flew over the US – showed signs of thawing.

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In May, Commerce Minister Wang Wentao met US Secretary of Commerce Gina Raimondo in Washington and Wang Yi met national security adviser Jake Sullivan in Vienna, but military-to-military communication remains shut down.

Ambassador Xie, who began his role in late May, met Biden in the White House Oval Office on Saturday.

He expressed Beijing’s hopes that the US would work with China “in the same direction” to stabilise and bring their relationship back on the right track, according to an embassy statement. Biden also accepted Xie’s diplomatic credentials.

China’s Ministry of Finance confirmed Yellen’s visit with a one-line statement and said it would include meetings with senior officials.

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The US Treasury Department said Yellen would “communicate directly about areas of concern, and work together to address global challenges”.

But a senior US official said the Biden administration did not expect significant breakthroughs during Yellen’s trip.