Yellen to meet US allies during IMF, World Bank meetings, press China on growth

Yellen to meet US allies during IMF, World Bank meetings, press China on growth

By David Lawder

U.S. Treasury Secretary Janet Yellen will meet with finance ministers from U.S. allies this week to discuss a number of key issues, including shoring up supply chains, strengthening financial system stability and supporting Ukraine, a senior U.S. Treasury official said on Monday.

Yellen's meetings on the sidelines of the International Monetary Fund and World Bank spring meetings in Washington also will include in-depth discussions with Chinese officials on "balanced growth," a new U.S.-China dialogue launched earlier this month to address China's excess industrial capacity for electric vehicles (EVs), solar panels and other clean energy goods.

On Wednesday, Yellen will meet with finance ministers from South Korea and Japan for a first-ever trilateral meeting to coordinate on issues from sanctions on Russia and Iran to securing supply chains and building climate and financial resilience in the Pacific Islands, the Treasury official said.

Yellen also will participate in a financial stability exercise with British and European banking union officials "to help fortify our financial systems for rapid coordination and communication during times of financial stress," the official said.

Finance ministers from the Group of Seven industrial democracies and Group of 20 major economies also are due to meet this week. During the G7 meeting Yellen hopes to advance discussions among the allies to unlock the value of frozen Russian sovereign assets to support Ukraine's resistance to the Russian invasion.

The official declined to discuss specific potential plans for the assets, adding that the G7 finance discussions were aimed at presenting G7 leaders with options to consider at a summit in Italy in June.

The discussions with Chinese officials will follow Yellen's trip earlier this month to Guangzhou and Beijing, in which she made the case for boosting China's domestic demand and warned Beijing that the U.S. could not accept a massive new wave of cheap Chinese exports of EVs and solar products decimating new U.S. industries in the same way that steel production was damaged a decade ago.

The official said the two sides would "get more into the weeds to start exchanging more detailed data" on the excess capacity issue.

The official said Yellen also will be talking up U.S. economic strength at the meetings and pushing for more progress on debt relief for vulnerable countries and the advancement of multilateral development bank reforms to better fight climate change.

"We expect that America's path to a 'soft landing' will continue to underpin global growth," the official said, referring to a scenario in which inflation in the U.S. could continue to drop without ruining the job market or causing a painful recession. "We've also been engaging with the world to mitigate short-term risks and support sustainable long-term growth, recognizing that the prospects for a soft landing are not felt equally everywhere."

Yellen will hold a press conference on Tuesday.