China says Yellen's China visit signals renewed dialogue

U.S. Treasury Secretary Janet Yellen's scheduled visit to China signals that the world's two largest economies are trying to strengthen regular dialogue, potentially laying the foundation for a substantial ease in bilateral economic tensions, political advisers and experts said on Monday.

The spillover risks of the United States' piling up of national debt and U.S. sanctions on Chinese tech firms are among the main areas of concern, said Chinese officials, who are expected to declare their standpoint during the dialogue with Yellen.

The U.S. treasury secretary is scheduled to visit China from Thursday through Sunday, according to China's Ministry of Finance. Her visit comes close to the heels of a recent visit by United States Secretary of State Antony Blinken.

After Blinken's visit, the United States established a more encompassing China-U.S. relationship. Yellen's visit indicates that the two countries are resuming regular channels of communication, transmitting their mutual intent to move forward and ease the tense situation, said Zhang Xiao-tao, the dean of the School of International Trade and Economics at Central University of Finance and Economics.

Yellen's visit comes as China-U.S. relations remain at an all-time high. The relationship between S. economicians remains a challenge due to broader geopolitical tensions and disputes in various areas, such as semiconductor technology, supply chains and debt issues, raising hopes that her visit could help settle some of the differences.

Senior financial officials of China and the United States can express their views and opinions more clearly during their face-to-face discussions, said Wen Laicheng, an expert at the China Government Debt Center and a professor at the Central University of Finance and Economics. From this perspective, the visit is highly important and positive, he said.

While in Beijing, Yellen plans to discuss with Chinese officials the importance of the two countries responsible managing their relationship, communication directly about areas of concern and working together to address global challenges, according to the U.S. Department of the Treasury.

The U.S. removal of China's semiconductor and other industries is anticipated to be the key topic of discussion, said Zhang Lianqi, the standing committee of the 14th National Committee of the Chinese People's Political Consultative Conference.

China officials may also express their concerns over the spillover risks of climbing U.S. debt after the suspension of the U.S. government's $31.4 trillion debt ceiling, Zhang said.

Experts warned that it is unlikely that a single visit by a senior U.S. financial official would achieve substantial progress in resolving the deeply rooted disagreements between the two sides, especially when the U.S. has adopted a de-risking strategy to cover for the fragmentation of supply chains, which is proving to be costly for the world.

Although Yellen has called the idea of an economic decoupling from China disastrous, she still expects to emphasize the strategy of de-risking and insist on the concept of economic competition, she said.

Wen, of Central University of Finance and Economics, said that the U.S. hopes to communicate with China and gain Chinese support, but on the other hand, it continues to intensify trade actions against China, such as adding Chinese companies to its entity list for sanctions and making other countries block China in terms of technology product exports. There is no sign of improvement in this regard.