The speech, which Yellen will deliver at Johns Hopkins University in Washington, comes as tensions remain high between the world’s two largest economies.
Last month, the new Chinese Foreign Minister, Chen Gang, accused Washington of stirring up tension between the two powers, warning of “conflict and confrontation”, after the meeting between Taiwan President Tsai Ing-wen and House Speaker Kevin McCarthy in California, a week after she was honored in New York with the Leadership Award.
However, Yellen affirmed the United States’ adherence to its conviction represented in defending its values and national security. “In this context, we seek a constructive and fair economic relationship with China,” she said.
She also stressed the need for countries to be able to “discuss difficult issues openly” and work together if possible.
Stressing that “correct economic competition” must be fair to be sustainable, Yellen said, “We will continue to partner with our allies in response to China’s unfair economic practices.”
It added that China had expanded its support for state-owned enterprises and domestic private companies in order to “dominate foreign competitors”.
Driven by security and values
Meanwhile, even though some US national security measures may have economic impacts, Yellen emphasized that these moves are “only motivated by our concerns about our national security and our values.”
“Our goal is not to use these tools to gain a competitive economic advantage,” she added.
Yellen also pushed back on the notion that US national security measures were intended to stifle China’s economic and technological modernization.
Chinese President Xi Jinping has previously criticized the United States for leading an effort to contain and suppress China’s technological advances.
Beijing’s technological ambitions have been constrained by the United States and its allies, and Chinese authorities have doubled down on the need to steer clear of imports for sectors seen as essential to national security, such as semiconductors.
Despite the differences between the two parties, Yellen and Wednesday stressed the need to cooperate in addressing pressing global challenges as well.
Washington and Beijing have clashed in recent years over trade, human rights and other issues, and relations soured further this year when the United States shot down a Chinese balloon it said was used for surveillance – a claim China vehemently denied.
While the two countries agreed to enhance communication on macroeconomic issues, as well as cooperation on climate and the debt crisis, Yellen said that “more needs to be done.”
“We call on China to keep its promise to work with us on these issues – not in our favor, but out of our shared duty and obligation to the world,” she added.
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