Yellen Calls for ‘Constructive’ China Relationship

WASHINGTON — Treasury Secretary Janet L. Yellen on Thursday called for a “constructive” and “healthy” economic relationship between the United States and China, one in which the two nations work together to confront challenges like climate change.

Ms. Yellen’s comments, which were delivered at Johns Hopkins University’s School of Advanced International Studies, struck a notably positive tone about the U.S.-China relationship following months of heightened tensions between the world’s two largest economies.

Ms. Yellen stressed the importance of securing American national security interests, as well as of protecting human rights. She also emphasized that targeted actions the United States has taken against China — like cutting it off from the world’s most advanced semiconductors — are aimed purely at protecting U.S. national security.

China has criticized U.S. restrictions on its technological development, saying that they are unlawful and a blatant effort to try and weaken the Chinese economy. Ms. Yellen sought to allay those concerns.

“These national security actions are not designed for us to gain a competitive economic advantage, or stifle China’s economic and technological modernization,” Ms. Yellen said. “Even though these policies may have economic impacts, they are driven by straightforward national security considerations.”

She also emphasized the strength of the American economy, noting that the economic output of the United States remains far larger than China’s.

Relations between the two nations have been tense recently, including a diplomatic blowup in February after a Chinese spy balloon traversed the United States before being shot down over the Atlantic Ocean. Republicans as well as Democrats continue to describe China as an obvious economic rival as well as a security threat.

Tensions also remain high over the future of Taiwan, which China claims as its territory. And many American officials have lost patience with the idea of bringing China into the rules-based international system, arguing that efforts to do so in past decades had failed to adequately improve its trade practices.

But Ms. Yellen argued that competition between the United States and China can lead to mutual improvement, within certain parameters.

“Sports teams perform at a higher level when they consistently face top rivals,” she said. “But this type of healthy competition is only sustainable if it is fair to both sides.” China has long used government support to help its firms at the expense of foreign competitors, and its industrial policy “has become more ambitious and complex,” Ms. Yellen said.