Treasury Secretary Janet Yellen Meets Chinese Vice Premier in Davos

Treasury Secretary Janet Yellen will meet with Chinese Vice Premier Liu He in Switzerland on Wednesday to discuss economic ties between the world’s two largest industrial powers.

The meeting will take place on the sidelines of the annual World Economic Forum in Davos, where top business, policy and media leaders come together to discuss the burning issues of the day.

This year’s gathering – the first in-person event in the alpine ski village since the coronavirus pandemic – began on Monday amid gloomy economic forecasts that include a possible global recession as well as continued high inflation.

Two-thirds of top private and public sector economists surveyed by the WEF expect a global recession in 2023, a Davos organizer said on Monday.

The survey comes after the World Bank cut its 2023 growth forecasts to near-recession levels last week for many countries as the impact of central bank interest rate hikes intensifies, Russia’s war in Ukraine continues, and the world’s major economic engines stop working.

The talks between Yellen and Liu, who holds a financial portfolio in President Xi Jinping’s government, are portrayed by US officials as a follow-up discussion to a summit meeting between the Chinese premier and President Biden on the sidelines of the G20 conference in Bali. last November.

Biden and Xi agreed to have officials maintain dialogue to ease tensions between the two powers.

Liu is scheduled to speak at the World Economic Forum in Davos on Tuesday. This is the first overseas trip by a senior Chinese government delegation since Beijing abandoned its controversial “zero COVID” policy last month.

US relations with China have gone through a difficult period, especially since the Biden administration moved to limit sales of computer chip technology to Beijing.

The Biden administration also signed into law the bipartisan CHIPS Act aimed at stimulating domestic semiconductor manufacturing.

Yellen will travel from Davos to Africa, where she will visit three countries – Senegal, Zambia and South Africa.

Washington is interested in improving relations with African governments, which have so far maintained extensive economic ties with rivals Russia and China.

In an interview on National Public Radio on Saturday, Yellen acknowledged that China has played a “leading role” in lending and trade with African countries, but said African leaders had made it clear at a conference last month in Washington that they were seeking a bigger engagement.

“It is clear that they want to expand trade and investment with many parts of the world and see the United States as a critical partner in this growth. And that’s important to us too,” Yellen said.

China’s trade relationship with Africa is four times that of the US. Beijing has also increased its influence on the continent by offering cheaper loans than Western countries.

But some African countries, including Zambia, have become disillusioned with Chinese lending and are looking for alternatives, economic analysts told Reuters.

Yellen has also openly called on China to end ties with Russia as the Kremlin continues its incursion into Ukraine.

The US and its European and Asian allies imposed sanctions and oil price caps on Russia in retaliation for the war, leaving China in a difficult position because it had promised “unlimited” friendship with Russia prior to the invasion.

This will be Yellen’s first face-to-face meeting with Liu since taking office, followed by three virtual meetings between the two.

With mail wires