Complete separation between US and Chinese economies would have negative repercussions, says US Treasury Secretary

US Treasury Secretary Janet Yellen has said the US is not seeking separation from China. The official said a complete separation between the U.S. and Chinese economies, or even an approach that forces nations to choose sides, would have significant negative impacts on the world.

“We have no interest in such a divided world and its disastrous effects,” she said in a speech released today on U.S. relations with the Indo-Pacific region.

Yellen said that given economic ties in the region and the complexity of global supply chains, such separation would not be practical.

Instead, the United States would mitigate risks and diversify its supply chains by “investing domestically and strengthening ties with allies around the world,” Yellen said.

The secretary also said that the U.S. economic approach to China will be centered on three objectives:

ensure national security and advance human rights;
seek a healthy economic relationship that is beneficial to both parties;
collaborate on global challenges, from climate change to fiscal stresses in low-income countries.

Yellen said these efforts also include responding appropriately to what she calls “China’s unfair economic practices,” citing as examples “non-market policies that harm American businesses and workers, barriers that the “China imposes market access and uses its economic power to coerce vulnerable trading partners.”