US Treasury Secretary Jaet Yellen has warned that China’s “willingness to embrace deeper economic integration” could be affected by its reaction “to our call for resolute action against Russia”.
US Treasury Secretary Janet Yellen warned China on Wednesday about its position vis-à-vis Russia, which she said threatens its “integration” into the world economy.
“The world’s attitude towards China, and its willingness to embrace deeper economic integration, may well be affected by China’s reaction to our call for resolute action against Russia,” the minister warned. Economy and Finance by Joe Biden, in a speech to the Atlantic Council, an American think tank.
China remained a partner of Moscow despite the invasion of Ukraine. The United States and its Western allies have taken several rounds of economic and financial sanctions against Russia, including asset freezes and transaction bans against major Russian banks. These measures must force “the Kremlin to choose between supporting its economy and financing the continuation of (Vladimir) Putin’s brutal war”, recalled Janet Yellen.
More broadly, she castigated the countries and companies that have not severed their trade ties with Russia, pointing out that these countries no doubt hope “to fill the void left by others by preserving their relations with Russia. This kind of motivations do not last in the long term”.
Reform international institutions
Janet Yellen also called for reform of major global economic institutions, saying the war in Ukraine demonstrated the need for organizations like the International Monetary Fund to evolve.
“We need to modernize our existing institutions – the IMF and the multilateral development banks – to make them fit for the 21st century, where challenges and risks are increasingly global,” she said, at five days of the start of the spring meetings of the IMF and the World Bank, which will again take place in hybrid mode.
Janet Yellen notably called for looking at “the governance of the institution, to ensure that it reflects both the current global economy and the members’ commitments to the underlying principles and objectives of the IMF”. “Some may say that now is not the time to think big,” admitted the minister. “But I think now is a good time to fix the flaws in our international financial system, which are causing us problems in real time.”
Beyond the situation in Ukraine, next week’s meetings will also focus on vaccine deliveries, the fight against global warming and support for low-income countries, said Janet Yellen.