US-China economic, security dilemmas intensify amid war in Ukraine

US Treasury Secretary Janet Yellen warns China of serious consequences if it supports Russia’s military actions in Ukraine during critical meeting

U.S. Treasury Secretary Janet Yellen delivered a stark warning to China, cautioning against any support for Russia’s military activities in Ukraine during high-level talks on Friday and Saturday.

“Secretary Yellen emphasized that companies, including those in the PRC (People’s Republic of China), must not provide material support for Russia’s war against Ukraine,” stated the U.S. Treasury, underlining the gravity of potential consequences.

These discussions follow Secretary of State Antony Blinken’s alarming revelations to EU and NATO foreign ministers.

Blinken reported that Beijing is aiding Moscow “at a concerning scale,” supplying them with “tools, inputs, and technical expertise” for Russia’s optical equipment, propellant production, and its space sector. This assistance, Blinken warned, not only aids Russia’s aggression in Ukraine but also poses threats to other countries.

Despite Western sanctions and trade embargoes aimed at crippling Russia’s economy, Russia’s defense industry remains robust, partly due to its expanded trade with China and support from countries like North Korea and Iran. This has enabled Russia to significantly boost its arms production, raising alarms in the West.

China, however, maintains a stance against lethal support for Russia, a point Yellen stressed. “On their side, China emphasized that it is their policy not to provide Russia with military support,” she said. Yellen also acknowledged progress in discussions concerning specific financial institutions, but stressed the need for further cooperation.

Amid these security concerns, the U.S. and China have also agreed to initiate “intensive exchanges on balanced growth” as part of efforts to stabilize the tumultuous relationship between the world’s two largest economies.

Yellen expressed her intentions for these talks: “I intend to use this opportunity to advocate for a level playing field for American workers and firms.” These talks will address macroeconomic imbalances and the issue of overcapacity, particularly in Chinese industries like solar, electric vehicles, and batteries.

Yellen acknowledged the complexities of these issues, saying, “It’s not going to be solved in an afternoon or a month.”

As Yellen prepares for her Beijing visit, these discussions signify a step toward routine engagements between the U.S. and China amid existing tensions over technology, Taiwan, and TikTok. However, the backdrop of the Ukraine crisis and China’s alleged support for Russia’s military seems to have intensified the complexity of these bilateral relations.

Source: Newsroom