Yellen presents three principles of economic policy toward China
Ahead of announcement of Chinese high-tech investment regulations
Chinese company Huawei-style export restrictions suggest
“Decoupling is a disaster… Continue economic exchange”
U.S. Treasury Secretary Janet Yellen has declared that national security takes precedence over the economy in relations with China and that there will be no compromise even if losses are incurred. At the same time, he also expressed his intention to visit China, saying that the complete “decoupling” of the two countries was a disaster. On key high-tech issues, it revealed the economic policy stance of the Joe Biden administration that it would pursue a security-oriented economic strategy while continuing the rest of the economic exchanges.
As President Biden is known to announce measures to regulate private investment in the Chinese high-tech sector at the end of this month at the earliest, analysts say that he made a gesture of appeasement to the public while building a justification for regulation.
● “Review of investment restrictions followed by export controls”
On the 20th (local time), Minister Yellen presented the three principles of the Biden administration’s public economic policy at the Graduate School of International Relations (SAIS) at Johns Hopkins University in Washington, DC. These are national security priority, the pursuit of sound economic relations in the rest of the field, and cooperation on the global debt crisis and climate change. SAIS, a prestigious international political science school, is also famous for Chinese Studies.
Minister Yellen said on the day, “National security is the most important thing in our relationship with China. Even if there are economic disadvantages, it is an area that cannot be compromised,” he said, making it clear that he puts security above the economy. It is evaluated that Secretary Yellen, who has been speaking indirectly about the US-China conflict as the head of the US government’s economy, has spoken more strongly and firmly.
“We have a wide range of means to achieve our (security) goals and will take narrowly targeted action if necessary,” he said. can,” he said. This means that the so-called ‘Huawei-style’ regulation, which bans exports of products containing US technology, is possible.
“We are looking at the risks of foreign investment in the United States and are reviewing programs that would limit US foreign investment in certain sensitive technologies of significant national security importance,” he said. This refers to the policy of limiting investment in China by US companies. On this day, Bloomberg News reported that President Biden announced an investment restriction policy before the G7 summit, and was considering signing an executive order after receiving support from the G7. The G7 summit will be held in Hiroshima, Japan, from the 19th to the 21st of next month.
It is the first time that the United States is regulating public and private investment, and it is expected to focus on high-tech fields such as artificial intelligence (AI) and quantum computing. Secretary Yellen repeatedly emphasized that the United States does not control exports and investment to win economic competition with China, but for security reasons.
However, there are also voices criticizing the principle of ‘security first’. Stephen Roach, a professor of economics at Yale University, said on Twitter that day, “Putting national security first is what Xi Jinping (President of China) said at the 20th Congress of the Communist Party of China in October last year.”
● “US-China decoupling is a disaster”… Seeking Cooperation
However, Minister Yellen urged cooperation, saying, “We welcome fair competition,” and that we will continue constructive and fair relations with China.
“We are not trying to decouple our economy from China. Decoupling would be a catastrophic blow.” It is interpreted that he emphasized that economic exchanges must continue in a reality where the US-China trade volume reached 700 billion dollars (about 930 trillion won) in 2021 and last year recorded the largest trade volume.
Minister Yellen said, “The US and China must find a way to live together and share world prosperity,” and said, “I will visit China at an appropriate time.” According to the US Wall Street Journal (WSJ), US-China high-level exchanges have stopped due to the Chinese reconnaissance balloon incident and Taiwanese President Tsai Ing-wen’s visit to the US, but working-level officials from the US Treasury and Commerce Department recently visited Beijing, and China also has Minister Yellen and Gina Lamondo. It is favorable to the minister’s visit.
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Source: Donga
Mark Jones is a world traveler and journalist for News Rebeat. With a curious mind and a love of adventure, Mark brings a unique perspective to the latest global events and provides in-depth and thought-provoking coverage of the world at large.