WASHINGTON: US Treasury Secretary Janet Yellen on Wednesday (Oct 12) said the global economy was facing “significant headwinds” and the United States was working to shore up its supply chains and guard against “geopolitical coercion” by Russia, China and others.
Yellen told an event hosted by the Bretton Woods Committee, a booster group, that Washington was working to deepen integration with the European Union and Indo-Pacific countries, including many emerging markets and developing countries while building in more redundancies in its supply chains.
“We know the cost of Russia’s weaponisation of trade as a tool of geopolitical coercion, and we must mitigate similar vulnerabilities to countries like China,” Yellen said, underscoring Washington’s determination to hold Russia accountable for its invasion of Ukraine and its initial blockade of food and energy shipments from the country.
Yellen and other Biden administration officials have also been outspoken about the need to reduce dependence on Chinese supply chains and counter what they see as Beijing’s bad behaviour in the global economy.
She said Washington was working to reduce US companies’ “extreme dependence” on semiconductors from Taiwan and other technologies, including solar panels or critical components for electric vehicle batteries made in China and a few other countries.
“Friend-shoring is not meant to be a tiny handful of countries. It’s not meant to be protectionism. It’s something that’s meant to (gain) diversity … but still get the benefits of trade,” Yellen said.
US Trade Representative Katherine Tai last month also raised concerns about China’s “non-market economic policies and practices and economic coercion” during a meeting with Britain’s new Secretary of State for International Trade Kemi Badenoch.