Yellen to discuss US-China ties, global economic outlook in Beijing

Yellen's four-day trip is her first to China as Treasury chief, and she is the second high-ranking US official to visit the country after Secretary of State Antony Blinken last month.

Washington and Beijing have traded barbs over issues including trade, human rights and national security -- and China has recently stepped up its response to US curbs on its access to chips.

Ahead of Yellen's trip, it unveiled new export controls on metals key to semiconductor manufacturing.

But Beijing struck an optimistic tone about the visit, with China's finance ministry saying Friday it would serve to "strengthen communication and exchange between the two countries".

"The nature of China-US economic and trade relations is mutually beneficial and win-win, and there is no winner in a trade war or 'decoupling and breaking chains'," a ministry official said in a statement.

On Friday morning, Yellen had a "substantive conversation" with her previous counterpart, former Vice Premier Liu He, as well as the outgoing governor of China's central bank, Yi Gang, a Treasury official said.

"They discussed the global economic outlook as well as the respective economic outlooks for the United States and China," the official added.

Yellen is also expected to meet with representatives of US firms in China at a session hosted by the American Chamber of Commerce.

That session will allow her to hear about the challenges American companies face while doing business in China, and she is expected to stress the concept of "healthy economic competition" that involves addressing what Washington deems unfair practices.

These include barriers to market access and actions targeting US firms.

On Friday afternoon, Yellen is due to meet Premier Li at the Great Hall of the People, providing a chance to discuss the economic relationship, raise concerns and find opportunities for collaboration.

- 'Avoid misunderstanding'-

In a tweet after arriving on Thursday, Yellen said that although the United States would protect its national security when needed, "this trip presents an opportunity to communicate and avoid miscommunication or misunderstanding".

The United States does not expect specific policy breakthroughs this time, but hopes for frank and productive conversations that can pave the way for future talks, a Treasury official told reporters on Thursday.

But, they said, "especially if they're things that we may disagree about, it's even more important that we're talking."

Tensions surged earlier this year when the United States detected and then shot down what it said was a Chinese spy balloon after the craft traversed its territory.

Blinken cancelled a visit to China over the incident but eventually travelled to the country in June. During that trip, both sides agreed on the need to stabilise their relationship.

But Yellen faces an uphill struggle in persuading officials in Beijing that US actions -- such as tightened export curbs on high-end semiconductors -- are aimed at safeguarding national security and not as an attempt to stifle China's economic ascendancy.

Underscoring the challenges she could face, The Wall Street Journal reported that the US administration is mulling restricting Chinese firms' access to US cloud computing services provided by companies such as Amazon and Microsoft.