Treasury Official: ‘We’re Not Trying to Massively Decouple’ from China

During an interview with Bloomberg on Monday, U.S. Treasury Undersecretary for International Affairs Jay Shambaugh stated that while the U.S. will defend its economic and security interests, “we’re not trying to massively decouple” the American economy from China’s.

Host David Westin asked, “We also have tensions over trade and other issues between the United States and China. The U.S. and China are the two biggest economies in the world. What is the U.S. agenda right now in terms of China and specifically on the question of so-called decoupling? There’s a lot of concern among American business that we are moving toward decoupling, which would really hurt our economy.”

Shambaugh responded, “Well, David, I think you kind of framed it the right way, which is they’re the two biggest economies, so, we obviously need to be able to work together. And I think that’s something you heard from the leaders when they had the summit in Bali, that they charged their teams to communicate and work together, and in particular, work together on global challenges. So, they said, the world expects us to be able to work together on some of these big challenges, whether it’s climate or debt or things like that. So, we’ll have to be able to communicate with our Chinese counterparts and try to help move these processes along. And I think you’ve seen us doing that. So, right after that leader summit in Bali, Secretary Yellen had an important bilateral with senior Chinese officials. Then, in January, we met face-to-face with…the vice premier at the time. And so — and we’ve had continued contacts at staff and at my level. And so, we’re really trying to make sure that we’re working with the Chinese on these important issues.”

He continued, “In terms of your specific question around decoupling, I think it’s important for us to be clear, the U.S. is not seeking to decouple from China. We’re not seeking to limit China’s growth. Those aren’t our strategic objectives. We, in some cases, have clear national security interests and we will always defend those interests. And so, sometimes that involves specific restrictions around specific technologies. But we’re not trying to massively decouple. We occasionally — or frequently have issues with different economic policies in China and we will always defend U.S. economic interests as well. But we’re not in any way trying to separate these two economies entirely. That’s just neither practical, nor in our interest.”

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