On November 2, US Treasury Secretary Janet Yellen delivered a speech at an event of the Asia Foundation Policy Institute (ASPI, USA) in Washington DC. In it, she outlined the White House's economic approach to the Indo- Pacific region, the strategic priorities shaping US bilateral and multilateral economic commitments in the region, and how the US focuses on strengthening the resilience of supply chains.
US Treasury Secretary Janet Yellen speaks at an ASPI event in Washington DC on November 2.
According to AFP, Secretary Yellen said that the US-China relationship is one of the most influential relationships in the world and needs to be properly managed.
She said the United States was working with China on international issues such as climate change and debt in low-income countries, but would not accept compromises on national security interests. She stressed that some recent US actions, such as restrictions on foreign investment, were aimed at protecting national interests, not at impeding China's growth.
According to the minister, a complete separation of the world's two leading economies is unrealistic, due to the complexity of supply chains in Asia and the region's deep economic ties with China, according to Reuters.
"A complete decoupling of our economies, or an approach where countries in the Indo-Pacific are forced to choose sides, would have major negative global repercussions. We have no interest in such a divided world and its disastrous effects," Ms. Yellen said.
However, Ms. Yellen said the US will diversify economic relationships to avoid dependence on China, by investing in domestic production and linking with allies and partners around the world, including in the Indo-Pacific.
"Claims that the United States is shifting away from the Indo-Pacific are completely unfounded. We are deepening economic ties across the region, with enormous potential benefits for the U.S. economy and the Indo-Pacific," Secretary Yellen said. Total two-way trade last year reached $2.28 trillion, up 25% from 2019. The Indo-Pacific accounts for nearly a quarter of total U.S. exports.
The minister's speech comes as the US and China prepare for a meeting between US President Joe Biden and Chinese President Xi Jinping in San Francisco this month. The date of the meeting has not been set but is rumored to take place on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit, which will take place from November 11-17 in San Francisco. The leaders will attend from November 15-17.
While all eyes are on the US-China summit, ASPI Vice President Wendy Cutler said the strained relationship between the two leading economies is unlikely to reverse overnight. Instead, she suggested that both sides should expect modest progress over time that builds trust and could yield some mutually beneficial outcomes.
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