In Beijing, Yellen Criticises China’s Treatment of U.S. Companies
In Beijing, Yellen Criticises China’s Treatment of U.S. Companies
One of the economic rifts that exist between the United States and China is one that is felt personally by American executives. These executives characterise the conditions they confront when conducting business in China as being tough, even unfriendly.
As the level of friction between the United States and China continues to rise, the United States Secretary of the Treasury, Janet L. Yellen, brought her worries into the open on Friday when she strongly objected in Beijing to punitive actions that the Chinese government has taken against international companies.
Ms. Yellen criticised the Chinese government for its severe treatment of enterprises with international affiliations and its recent move to put export curbs on key vital minerals when she was surrounded by executives from some of the most prominent companies in the United States. She seemed to imply that such activities justified the efforts that the Biden administration was making to reduce the reliance of American industries on China.
The statements made by Ms. Yellen to a group of executives from American firms working in China brought to light the difficulties that the world’s two largest economies confront as they attempt to resolve the profound divides that separate them from one another.
During a high-stakes trip to Beijing as part of an effort to defuse the tension that has been building up between the United States and China, she gave a vigorous defence of American business on the first day of her talks there. During what was the first trip to China by a Treasury secretary in the past four years, Ms. Yellen voiced her disagreements to the highest-ranking authorities in China, including Premier Li Qiang.
At an event hosted by the American Chamber of Commerce in China, Ms. Yellen made the following statement: “During meetings with my counterparts, I am communicating the concerns that I’ve heard from the U.S. business community.” These concerns include China’s use of nonmarket tools such as expanded subsidies for its state-owned enterprises and domestic firms, as well as barriers to market access for foreign firms. Ms. Yellen made these remarks.
She went on to say, “I’ve been particularly troubled by the punitive actions that have been taken against U.S. firms in recent months,” There were participants from a variety of companies, including Boeing, Bank of America, and the multinational agricultural corporation Cargill.
The Mintz Group is an American consulting firm that has 18 offices located all over the world. In March, the Chinese authorities shuttered the Beijing branch of the company and arrested five Chinese citizens who were working there. The next month, the authorities questioned staff working for the American management consulting company Bain & Company at their Shanghai office. Bain & Company is located in Shanghai.
Following the limits that the administration of Vice President Joe Biden put on China’s access to vital semiconductor-making technologies and tools, American companies with operations in China came under intense scrutiny.
The administration of Vice President Joe Biden is working on putting new restrictions on the transfer of technological goods between the United States and China. These constraints may include potential limitations on sophisticated semiconductors and American investment in China. In addition, the administration is working on plans to limit Chinese firms’ access to cloud computing services offered in the United States in an effort to limit China’s use of sophisticated semiconductors for artificial intelligence.
The back-and-forth resumed last week when Beijing responded against the constraints that the Biden administration had placed on semiconductors by stating that it would ban the export of some essential minerals that are needed in the fabrication of particular chips. last move was in response to the limits that the Biden administration had placed on semiconductors. On Friday, Ms. Yellen expressed that she was “concerned” about the export limits that China has implemented, and she hinted that more measures from the United States may be on the horizon.
Chinese corporations have also felt a chill of scepticism in the United States, and they have been rattled by recent acts, such as the congressional hearings against the Chinese-owned social media network TikTok, when senators spent five hours criticising TikTok’s links to China. These hearings took place earlier this month. TikTok has been informed by the administration of Vice President Joe Biden that it wants the Chinese company ByteDance, which owns the app, to sell the app or face the possibility of a ban in the United States.
According to Wang Yong, the head of the Centre for American Studies at Peking University, increasing American impediments to Chinese investments and corporate dealings, especially in relatively mundane industries such as farmland acquisitions, have also upset Chinese enterprises.
According to Professor Wang, “Unfortunately, these relationships that have been mutually beneficial have now become politicised, securitized, and even demonised — all while being treated as having an impact on national security.” “However, in my opinion, despite the fact that China and the United States are supposedly engaged in strategic competition with one another, they still share a great number of common interests.”
On Friday, an official from China’s Ministry of Finance expressed hope that the discussions with Ms. Yellen would strengthen economic relations between the two countries. The official also said that the United States needed to take actions to make this happen. The official continued by saying that “decoupling” and causing disruptions in supply chains were beneficial to neither country.
Those who have followed the bilateral relationship between the two nations for a considerable amount of time viewed the prospects of an immediate breakthrough with scepticism.
It is not reasonable to anticipate that Ms. Yellen’s visit will “really mitigate substantially” the vast and broad gaps that exist between the two nations, according to Shi Yinhong, a political scientist at Renmin University in Beijing. However, because of these disparities, he added that it was highly unlikely that Chinese authorities would be taken aback by Ms. Yellen’s words in support of American enterprises operating in China.
“I doubt that the Chinese side would have much higher expectations at all,” he added. “I doubt that the Chinese side would have much higher expectations.”
Businesses in the United States have expressed concern about China’s ever-tightening national security rules, one of which is a tough counterespionage legislation that just went into force this past weekend. This week, the United States Department of State issued a warning recommending American citizens to rethink their plans to travel to China due to the danger of being wrongfully detained there.
