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US Treasury Secretary Janet Yellen (L) looks on as Chinese President Xi Jinping (C) arrives at San Francisco International airport to attend the Asia-Pacific Economic Cooperation (APEC) leaders’ week in San Francisco, California, on November 14, 2023.

Frederic J. Brown | AFP | Getty Images

Treasury Secretary Janet Yellen said Monday that U.S. President Joe Biden and Chinese President Xi Jinping remained far apart on the status of Taiwan after their high-profile meeting last week during the Asia-Pacific Economic Cooperation summit in San Francisco.

“President Xi did express the view that it’s important for Taiwan and mainland China to unify. He certainly expressed the desire to have that occur by peaceful means,” Yellen said on CNBC’s “Squawk Box.” “But President Biden said our policy remains unchanged from what it’s always been with respect to Taiwan.”

The U.S. recognizes the People’s Republic of China as the sole government of China but also maintains that Taiwan is a self-governing island, despite China’s claims to the contrary.

Even after their talks last week, Biden and Xi’s deadlock on the issue could have military ramifications, despite Xi’s insistence that he does not want military conflict.

Already, Taiwanese officials have reported escalating Chinese military action around the island in recent months. In September, Taiwan’s defense minister said China was operating dozens of warships, drones, bombers and more nearby. Officials fear that China’s military activity around Taiwan could lead to accidental confrontation and explode into a full-fledged conflict.

U.S. military officials have warned that China could be ready to launch an attack against Taiwan by 2027. They have criticized the U.S. for not providing enough military support to Taiwan to deter China.

“Deterring a Chinese invasion of Taiwan will require turning the island into a porcupine, stockpiled with an arsenal of weapons that can target the Chinese fleet,” U.S. officials wrote in an October letter to the U.S. Navy secretary. “Bureaucratic delays within the Navy are … undermining efforts to prevent war.”

Biden has proposed a $105 billion aid package, primarily for Ukraine and Israel fighting their own respective wars, which includes a mere $2 billion for Taiwan and broader Indo-Pacific security measures.

Yellen said Monday that package is “critical to the national security of America.”

But any amount of U.S. support for Taiwan’s independence puts relations with China, which believes that it has a right to govern Taiwan, on shaky ground.

When former U.S. House Speaker Nancy Pelosi visited Taiwan in a show of support for the country’s sovereignty in August 2022, China suspended military communication with the U.S. Without that open communication, U.S. and China naval and air forces have had several close-call confrontations.

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Last week at their meeting, Biden and Xi agreed to revive military-to-military communication, though they still disagree on the status of Taiwan.

“We maintain the agreement that there is a One China policy and I’m not going to change that, that’s not going to change. That’s about the extent to which we discussed,” Biden said at a news conference last week, hours after he met with Xi.

Last Wednesday was the first meeting between Biden and Xi in a year. It was an important step to reestablish at least the appearance of cooperation between the two countries after a tumultuous year of spy balloons, trade disagreement and near-miss military incidents that chilled U.S.-China communication.

Besides the Taiwan issue, Yellen said that the two leaders also discussed cooperation on fentanyl regulation, artificial intelligence, climate change and the bilateral economic relationship.

In the week leading up to APEC, Yellen met with her Chinese counterpart, Vice Premier He Lifeng, where they talked broadly about some of the same topics. Yellen said she plans to visit China next year.

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