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US-China relations
EconomyChina Economy

Joe Biden cabinet: US Treasury Secretary pick Janet Yellen faces huge challenge to reconcile China trade policy, support American economy

  • US President-elect Joe Biden has reportedly selected former US Federal Reserve chairwoman Janet Yellen for US treasury secretary
  • The pick suggests more orthodox and predictable US engagement with China on economic issues over the next four years, analysts say

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President-elect Joe Biden’s reported choice of Janet Yellen indicates a more orthodox approach to China on economic issues. Photo: AFP
Karen Yeung

Janet Yellen will step into a difficult role as US Treasury Secretary, facing the immediate need to support a domestic economy at risk of slowing significantly due to the latest surge in the coronavirus pandemic, while beginning the delicate task of reversing some Trump-era trade measures imposed on China and other countries, analysts said.

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President-elect Joe Biden’s reported choice of Yellen indicates a more orthodox, predictable US government approach towards China in the realms of economic and trade policies compared with the Trump administration, analysts agreed. But the challenge for Yellen will be enormous.
She is someone who understands the need for a stronger economy and for easy [economic] conditions to get there
Evan Brown
Yellen disagreed on economic grounds with the tariff strategy that the Trump administration has pursued for the last two years against China, seeing the duties as a tax paid by US consumers and thus damaging to the American economy.

“She is someone who understands the need for a stronger economy and for easy [economic] conditions to get there,” said Evan Brown, head of multi-asset strategy at UBS Asset Management.

“The first six months of the [Biden] presidency will be focused on building up the US rather than tearing down other countries. We would not be surprised to see some tariffs removed as a partial reset in relations over the course of 2021.”

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Known as a labour market academic before she joined the US Federal Reserve, she quickly gained praise for her monetary policy expertise during her time at the American central bank, which started in 2004 as president of the bank’s San Francisco branch and culminated as chair between 2014 to 2018.

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