US Treasury Secretary Janet Yellen faces tough job of stabilizing fractious ties with China: Report

Washington DC [US], July 8 : US Treasury Secretary Janet Yellen faces the tough job of stabilizing fractious US-China relations that worsened this week after China retaliated in a tech war with the United States, CNN reported.
China on Monday announced restrictions on exports of two strategic materials needed to make semiconductors, which are crucial for the normal functioning of daily life and a growing source of tension between the world's top two economies.
A former Chinese vice-minister of commerce, Wei Jianguo, said: "This is just the beginning. China's toolbox has many more types of measures available."
As per CNN, the issues that need to be worked out between the superpowers are thorny and complex, even as their economies seem to defy talk of decoupling to become ever more intertwined.
The US Treasury Secretary is currently on a visit to Beijing. Four things, however, make it harder for Yellen to repair US-China ties, as per CNN.
First is the US-China chip war. The tussle over the future of semiconductors has escalated in recent months, drawing in Japan and Europe. Beijing played a trump card earlier this week when it imposed export controls on two raw materials, gallium and germanium, that are critical to the global chip-making industry.
China's raid on US businesses also acts as an impediment to forging friendly relations. Beijing's crackdown against Western consulting and due diligence firms has unnerved US businesses.
Beijing in April updated its counter-espionage law, which expanded the list of activities that could be considered spying.
Another impediment is the US' possible restrictions on investment in China. The Biden administration has since earlier this year, been mulling new rules that could limit investment in key parts of China's economy by American businesses, according to multiple media reports.
A group of congressional Republicans in April called on the administration to "use all available tools" to sanction cloud computing firms with links to China.
Then comes De-risking. Hawks have been calling for the US to decouple from China, an unrealistic proposition given the extent of the bilateral trade and investment ties.
Still, US President Joe Biden and his European allies have repeatedly stressed the desire to "de-risk" their relationships with the Chinese economy.
The war in Ukraine has fueled worries over Taiwan, which China has threatened to invade.
The concerns have led to coordinated efforts to remove China from technology supply chains that can be used to advance its military strength. That has been met with strong opposition from Beijing, according to CNN.