U.S. Secretary of the Treasury Janet L. Yellen met on April 5-6 with Vice Premier He Lifeng of the People’s Republic of China in Guangzhou, China. Secretary Yellen and Vice Premier He had frank and productive discussions on the U.S.-China bilateral economic relationship and a wide range of issues. Secretary Yellen noted areas of cooperation and directly raised issues of concern.
Secretary Yellen and Vice Premier He opened discussions with an exchange of views on domestic and global macroeconomic and financial developments. Secretary Yellen explained that the U.S. economy remains resilient and has been a key driver of global growth. She acknowledged significant headwinds and risks to the global economy, including the need for Russia to end its illegal war against Ukraine. The two sides also discussed the outlook for the Chinese economy and financial developments.
Secretary Yellen reaffirmed with Vice Premier He the important foundations of the U.S.-China economic relationship that the two sides agreed to in November, including the need to intensify communication, the shared objective of a healthy economic relationship that provides a level playing field, and a commitment to work together on shared challenges, including climate finance and debt issues in low-income and emerging economies.
After extended and substantive discussions, Secretary Yellen and Vice Premier He announced two significant new initiatives that the U.S. and China will launch on economic issues:
- Exchange on Balanced Growth in the Domestic and Global Economies: Co-led by the U.S. Department of the Treasury and China’s Ministry of Finance under the framework of the Economic Working Group, the United States and China have agreed to hold intensive exchanges on balanced growth in the domestic and global economies. In these discussions, the two sides will discuss more balanced economic growth and its importance to the world economy, including issues like domestic demand, investment policies, aging populations, fiscal issues, and related policies.
- Joint Treasury-PBOC Cooperation and Exchange on Anti-Money Laundering: The U.S. Department of the Treasury and the People’s Bank of China have agreed to start an exchange under the framework of the Financial Working Group to cooperate on our shared priority of combatting money laundering in our respective financial systems. This exchange will enable economic officials and experts from the U.S. and China to regularly share best practices and updates about our efforts to combat illicit finance, including efforts to close gaps in the U.S. and Chinese financial regulatory systems. This effort will help close off financing avenues for criminal organizations, including drug traffickers, human traffickers, and fraudsters. The first such exchange will be held in the coming weeks during the fourth Financial Working Group meeting.
In addition, the U.S. and China agreed to continue holding technical exchanges on financial issues, including upcoming ones on operational resilience in the financial services sector and on financial stability implications from the insurance sector. Secretary Yellen also expressed appreciation for the progress made on conversations around sustainable finance.
Secretary Yellen also raised concerns regarding the breadth and scale of China’s non-market policies and practices and their impact on U.S. workers and firms. She noted signs of increasing overcapacity in certain sectors of the Chinese economy and urged action to address the concerns.
Secretary Yellen and Vice Premier He also discussed recent national security actions. Secretary Yellen emphasized that companies, including those in the PRC, must not provide material support for Russia’s war against Ukraine, including support to the Russian defense industrial base, and the significant consequences if they do so. She underscored that U.S. national security actions in the economic sphere are predicated on clearly defined national security concerns, narrowly scoped, and transparently implemented. She also underscored that the United States is not seeking to decouple from China.
The meetings build on progress made by President Biden and President Xi at the Woodside Summit last November and Secretary Yellen’s previous meetings with Vice Premier He. Both sides agreed to keep in close contact and to continue progress through the Economic Working Group and Financial Working Group, which have met three times since their establishment last fall.
