US Treasury chief goes to China

US Treasury Secretary Janet Yellen is kicking off a four-day visit to China on Thursday. The last time such a visit took place was four years ago, at the height of the Trump’s US-China trade war.

To be sure, Yellen’s trip is more about messaging than substance, with both sides already trying to mitigate expectations of a significant breakthrough as bilateral relations remain extremely tense.

Still, there will be many thorny issues on the agenda, in particular deepening tit-for-tat trade and tech controls. While taking a less publicly combative approach toward China than his predecessor, President Joe Biden has kept in place almost all of the Trump-era trade tariffs on Chinese products, and has in fact doubled down on efforts to quash Beijing’s influence in the burgeoning tech space.

Crucially, Biden has recruited allies to join Washington in blocking semiconductor exports to China, as well as other materials crucial to the development of artificial intelligence. In fact, the Dutch government just announced new export restrictions on machinery, prompting China to hit back by placing fresh export bans on two crucial metals needed to make chips – and warning of more to come.

Yellen will hope to lower temperatures amid growing fears that China could extend these restrictions to other commodities – like rare earth minerals, a field Beijing dominates – that are crucial to manufacturing electric vehicles and other essential tech. But China isn’t going to unilaterally soften its approach, and it is hard to imagine the US changing its tune in the months ahead, particularly amid an election cycle where tough-on-China policies resonate across the political aisle.