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- The Treasury will send officials to China this week to discuss a range of economy issues, the NYT reported.
- Talks will revolve around business and market practices that have put the superpowers at odds.
- President Joe Biden and Xi Jinping agreed last year to communicate more on economic issues.
The US Treasury is sending an envoy of department officials to China this week as the two superpowers seek to iron out economic tensions in line with agreements between Joe Biden and Xi Jinping made last year, The New York Times reported on Monday.
The two days of bilateral talks will touch on a range of topics, including practices around government subsidies and concerns about flooding the market with cheap products. The discussions, which haven't been publicly announced yet, will also touch on China's status as one of the world's largest creditors to emerging markets economies and ways to help countries with their sovereign debt loads to allow them to invest in climate initiatives.
Biden and Xi agreed last September to step up communication around economic issues to help ease what has been growing strain on the relationship between the two countries in recent years.
Per the NYT, the Treasury group heading to Beijing will be led by Jay Shambaugh, the department's Under Secretary for International Affairs. The talk could lay the groundwork for Treasury Secretary Janet Yellen's second trip to China following her trip to the country last summer.
Officials in China have been grappling with an ailing economy, prompting the government to mull a $278 billion rescue package to stabilize the stock market, a $140 billion liquidity injection to reenergize the banking system, and fresh measures to prevent further fallout in the property sector.
China's excess capacity problems will also be discussed at the meeting, the NYT report says. The country's sluggish demand with oversupply, has affected various industries including chemicals, ferrous and non-ferrous metals, and newer sectors like renewable energy.
On top of that, officials from the two countries will discuss joint efforts to combat climate change, the report says.
China's slower-than-expected recovery from the COVID-19 pandemic compared to the US has led to bearish calls from many forecasters on Wall Street, with property sector distress a particular focus. The real estate crisis deepened last week as Evergrande was ordered to liquidate by a Hong Kong court after years of attempts at restructuring.
The upcoming meeting will be the first in Beijing for the economic working group established last September. In January, a Treasury delegation focused on financial matters held talks in Beijing.