US Treasury Secretary Janet Yellen completed her second trip to China, where she addressed American concerns about Chinese overproduction, cautioned against supporting Russia, and sparked conversation on Chinese social media regarding her travel style and chopstick skills. Over the course of four days, Yellen met with Chinese leaders, local officials, academics, students, and American executives in Guangzhou and Beijing. The purpose of her visit, the second in nine months, was to address escalating trade disputes between the two countries following a summit between US President Joe Biden and Chinese leader Xi Jinping.
During her visit, Yellen conveyed a tough message to Beijing regarding China’s surging exports of state-subsidized electronic vehicles (EVs), solar panels, and batteries, which are threatening American jobs and businesses. She expressed concerns about the negative impact of China’s macroeconomic imbalances on the US and the global economy, particularly related to weak household consumption and government support in certain industrial sectors. Despite the positive tone of Chinese state media coverage, there was little indication that Beijing was willing to make concessions on its economic policies.
The issue of Chinese overcapacity in key industries such as EVs and solar panels was a major point of contention during Yellen’s trip. She reiterated concerns about China’s enormous production capacity affecting global prices and the viability of American and foreign firms. Chinese Premier Li urged Washington not to politicize economic and trade issues and to adhere to market economy norms. While Beijing has acknowledged its overcapacity problem, Chinese state media have challenged the idea that it poses a threat to other economies. Yellen acknowledged that concerns over Chinese oversupply will take time to address, but her trip established a structure for raising concerns about China’s imbalances and overcapacity in a targeted manner.
Yellen also addressed the issue of Chinese companies potentially providing support to Russia in its conflict with Ukraine. She warned Chinese companies of “significant consequences” if they assisted Russia and discussed national security concerns with Chinese officials. China’s Foreign Ministry emphasized the importance of normal cooperation between China and Russia and called on relevant countries not to interfere with China’s state-to-state relations. Yellen’s trip aimed to maintain open lines of communication with Beijing to manage competition and prevent conflict, following the recent phone call between Biden and Xi.
While Yellen took a firm stance on certain issues, she was warmly welcomed in China, especially on social media, due to her down-to-earth style and reported love for Chinese food. Chinese social media users praised Yellen for her unassuming demeanor and observed her skill with chopsticks during a dining outing in Guangzhou. The attention she garnered highlighted her ability to connect with the Chinese culture and understand the importance of bilateral relations. Yellen’s trip, although challenging at times, contributed to the ongoing efforts to build a stronger US-China relationship, addressing concerns of American business executives and ensuring transparency in national security issues.
