U.S. Treasury Secretary Janet Yellen called Saturday for close communication between the world's two largest economies amid their intensifying rivalry as she met with China's Vice Premier He Lifeng in Beijing, the Treasury Department said.

"Amid a complicated global economic outlook, there is a pressing need for the two largest economies to closely communicate and exchange views on our responses to various challenges," Yellen told He, who is in charge of economic and financial affairs.

"This communication can help both sides more fully understand the global economic outlook and make better decisions to strengthen our economies," she added. He expressed his wish to communicate with Yellen on issues such as macroeconomic policies, economy and trade, according to a Hong Kong media report.

The Treasury chief is in China, with her trip through Sunday intended to help improve Sino-U.S. ties that have become strained over a host of issues, including tit-for-tat export control measures on items related to semiconductors.

U.S. Treasury Secretary Janet Yellen (front, L) speaks as Chinese Vice Premier He Lifeng (front, R) listens during a meeting at the Diaoyutai State Guesthouse on July 8, 2023 in Beijing. (Getty/Kyodo)

Last October, the U.S. administration of President Joe Biden announced sweeping export curbs on certain advanced computing chips and related items in an effort to hobble Beijing's bid to develop advanced technologies for military purposes.

In a possible retaliation, China unveiled shortly before Yellen's trip that it will tighten export controls of gallium and germanium -- rare earth metals crucial for chip production -- from Aug. 1.

In her talks with He, Yellen noted that the United States and China had record bilateral trade in 2022 despite recent tensions, which suggests "ample room for our firms to engage in trade and investment."

Repeating her message conveyed to Chinese Premier Li Qiang the previous day, Yellen said in the meeting with He that the two countries should not allow any disagreement to lead to misunderstandings that can unnecessarily worsen their bilateral economic and financial relationship.

On Friday, Li told Yellen that politicizing economic cooperation or overstretching the concept of security on such cooperation "does no good for the economic development of the two countries and the whole world," according to China's official Xinhua News Agency.

Prior to meeting with He, Yellen attended a roundtable on climate change with financial institution representatives and hosted a lunch with Chinese female economists and entrepreneurs, the Treasury Department said.

"Continued U.S.-China cooperation on climate finance is critical," she said, referring to the world's two largest emitters of heat-trapping greenhouse gases.

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