China reacts unenthusiastically to Yellen's olive branch for talks

Treasury Secretary Janet Yellen speaks on the US-China economic relationship at Johns Hopkins University School of Advanced International Studies, April 20, 2023, in Washington. [VOA]

China on Friday did not reciprocate U.S. Treasury Secretary Janet Yellen's appeal for the world's two biggest economies to resume official communications. In a speech detailing the Biden administration's economic priorities on China a day earlier, Yellen said the U.S. seeks constructive and fair economic ties with China without compromising its national security.

Chinese Foreign Ministry spokesperson Wang Wenbin responded by accusing the U.S. of now using technology and trade issues between the two economies as a tool and weapon "in the name of national security."

"The U.S. has been building 'small yards with high fences' and pushing for decoupling and fragmenting industrial and supply chains," Wang said at a daily briefing Friday. "The true intention of the U.S. is to take away the right to development from China and maintain U.S. supremacy for its selfish interests."

In recent years Washington has focused on increasing controls over technology trade with China, arguing that some advanced technology such as 5G, artificial intelligence, and quantum computing with substantial military applications should only be purchased from allied nations. Even more ordinary technology like the popular TikTok app is under scrutiny because of suspicions China's government uses it for surveillance or other purposes.

Gary Hufbauer, a senior fellow at the Peterson Institute for International Economics, said Beijing's unenthusiastic reaction to Yellin's statement is not a surprise.

"From the Chinese standpoint, they see the U.S. definition of national security as quite expansive and they don't quite know what it will cover," he told VOA Mandarin. "Their concern is that a lot of the national security measures do, in fact, limit their technology and limit their prospects for growth."

David Dollar, an economist at the Brookings Institution, told VOA that China will be cautious in responding positively to the U.S. "as there are still a lot of hostile voices in the U.S.," but "it is likely that sometime soon high-level dialogue between the two countries will resume."

Earlier this month, senior officials from the Department of Commerce traveled to Beijing and Shanghai to lay the groundwork for a potential trip by Commerce Secretary Gina Raimondo later this year.

A call to resume dialogue

U.S.-China relations entered a downward spiral in recent years, with each side increasingly seeing the other as its top strategic and economic threat. President Joe Biden met with Chinese President Xi Jinping last November in an effort to stabilize the relationship, but any progress was sidelined in February when the U.S. shot down an alleged Chinese spy balloon over American territory. The incident led to the cancellation of Secretary of State Antony Blinken's trip to China, and delayed Yellen's planned visit to Beijing.

In her Thursday speech at Johns Hopkins University's School of Advanced International Studies in Washington, Yellen said that the U.S. does not seek to "decouple our economy from China's."

"A full separation of our economies would be disastrous for both countries. It would be destabilizing for the rest of the world. Rather, we know that the health of the Chinese and U.S. economies is closely linked. A growing China that plays by the rules can be beneficial for the United States," she said.

She added that she plans to travel to China "at the appropriate time."

The Brookings Institution's Dollar said Yellen's softer tone shows the administration's willingness to resume dialogue with Beijing on global issues.

"The U.S. wants to reestablish dialogue on economic issues, especially global concerns such as climate change, developing country debt problems, and macroeconomic policy coordination," he told VOA Mandarin.

Hufbauer with PIIE described Yellen's speech as having "a friendly tone without much substance."

"It basically amounts to an invitation to China to talk with her," he told VOA.

Edward Alden, a senior fellow specializing in U.S. economic competitiveness at the Council on Foreign Relations, told VOA that the speech was also geared toward U.S. policymakers.

"I think this speech was an effort to reconcile the two contradictory elements at the heart of the current U.S. policy towards China, which sees China as a security rival but potentially as an economic partner or a worst competitor," he told VOA.

Some have criticized Yellen's soft tone with China. U.S. Senator Tom Cotton, a Republican, described Yellen's wish to resume conversation with China as "out of touch with reality."

"There can be no 'healthy relationship' with communists who want America to fail," he tweeted.