Yellen Says US, China Should Jointly Tackle Climate-Change Issue

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(Bloomberg) — China and the US should join forces to tackle climate change, Treasury Secretary Janet Yellen said Saturday, pushing for greater cooperation on key issues during a trip aimed at improving their strained relationship.

“Climate change is at the top of the list of global challenges, and the United States and China must work together to address this existential threat,” Yellen said at a roundtable on sustainable finance in Beijing, according to a text of her prepared remarks.

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Despite increasingly adversarial relations between China and the US, Yellen has often argued that the two nations, as the world’s two largest economies, have a duty to cooperate on major global challenges including environmental issues and debt distress in poorer nations.

“As the world’s two largest emitters of greenhouse gases and the largest investors in renewable energy, we have both a joint responsibility – and ability – to lead the way,” Yellen said at the gathering attended by Chinese and international climate experts.

Her comments come at the beginning of her second day of meetings in Beijing, in a trip largely aimed at re-establishing communication channels between the two geopolitical rivals.

Saturday Engagements

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Later Saturday, Yellen will hold a meeting and subsequent dinner with her Chinese counterpart, Vice Premier He Lifeng, a senior Treasury official said, arguably her most important engagement during her visit in Beijing.  

Yellen also met with Chinese Premier Li Qiang on Friday, which the Treasury official said was a high-level discussion about the broader US-China relationship. Her meeting with He is more likely to touch on specific concerns by both sides, the official said.

In a report Friday evening, the official Xinhua News Agency said Li identified mutual benefit as the essence of US-China relations and that he called for more communication and strengthening consensus on bilateral economic issues. The two sides should have candid, deep and pragmatic talks, Xinhua reported the premier as saying.

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In Beijing, Yellen is seeking to explain to her counterparts the US strategy she outlined in April that’s geared toward defending and securing US national security without trying to hold China back economically. 

The task is particularly tricky as the US and China remain locked in a tit-for-tat trade war that ramped up last year with US export controls on semiconductors and chipmaking equipment.  

The Biden administration is preparing an executive order curbing US outbound investment in China, which could come as soon as July and cover certain investments in sensitive technologies including semiconductors, artificial intelligence and quantum computing. 

Meanwhile, President Xi Jinping’s government imposed controls on two critical minerals used in advanced technologies days before Yellen’s arrival. Earlier on Friday, she told a roundtable of US business people operating in China she was “concerned” by those curbs.  

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Yellen’s message to Chinese officials is that competition between the two countries is not a “winner-take-all” situation and both sides should manage their rivalry with a fair set of rules.

Treasury officials have downplayed expectations of any major breakthroughs during the trip, saying instead it is aimed at building longer-term communication channels with the Chinese government’s new economic team. 

US-China engagement now is a shadow of what it once was. The Treasury secretary at one point would meet with China’s equivalent every six months through the “Strategic Economic Dialogue,” but such forums became defunct in the Trump administration, which levied a raft of import tariffs on Beijing. 

While the Treasury official said restoring this dialogue wasn’t specifically discussed in Yellen’s meeting so far, the talks with He could touch on how the two sides can set up frameworks to communicate appropriately.

—With assistance from Yujing Liu.

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