Janet Yellen in China: how far did trip move the ball for US-China relations as presidential election looms?
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US Treasury Secretary Janet Yellen's week-long trip to China focused on practical short-term issues, including overcapacity concerns, money laundering, and the mistreatment of US companies in China. Yellen claimed that 'major steps' had been taken to stabilize relations since her last visit in July, but acknowledged that many issues remained unresolved. Analysts believe that the pressure of the upcoming presidential election could force the Biden administration to take a more aggressive stance on the trade front. However, they also believe that the Biden team has generally taken a mild approach towards China and may not want to start a real trade war in 2024. Both countries are expected to maintain communication and deeper exchanges, but the US's small-yard high-fence strategy and concerns about overcapacity may lead to the implementation of other restrictive measures. China raised concerns about trade tariffs and export controls but does not expect them to be resolved. Yellen also had 'difficult conversations about national security' with Chinese leaders and exchanged information on the use of economic tools in the national security space. Both sides have reasons to keep the talks going and appear constructive to the world.
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