After attempting to resolve significant issues between the two nations, U.S. Treasury Secretary Janet Yellen and her colleagues are departing China.
By dominating the global market for highly subsidized solar products, electric vehicles, and lithium-ion batteries, Yellen hoped to address a grievance that the Biden administration had raised about Beijing’s economic model and trade practices, which it claimed unfairly disadvantaged American businesses and workers. With the help of subsidies and other legislative incentives, Chinese manufacturers of solar panels and electric vehicles have invested in plants, increasing output capacity beyond what the local market can handle.
Throughout the week of meetings, she spoke on the dangers of a single country controlling a large portion of the world’s production capacity in specific sectors, the risks this presents to other countries’ industries, and the far-reaching effects of a sudden surge in exports from just one country. After two days of extensive conversations in Guangzhou, Yellen and Chinese Vice Premier He Lifeng agreed to engage in “intensive exchanges” over the pursuit of more balanced economic development.
The first meeting of the new U.S.-Chinese cooperative will take place in the next weeks; it will be a component of the economic working groups established between the two countries in September. During the course of U.S.-China discussions, the Chinese raised the possibility of a ban on the social media app TikTok, which is owned by the Chinese parent firm ByteDance. The White House has backed attempts by legislators in the United States to either outright prohibit the app or have the Chinese corporation sell its shares in the company.
During Yellen’s second day in China, the two nations’ financial authorities conducted a series of drills to mimic the collapse of a central bank in each country. The goal is to figure out how to work together in the case of a bank collapse so that the world’s financial system doesn’t take a devastating hit.
