Yellen kicks off China meetings with overcapacity concerns, encouraging market-oriented reforms

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U.S. Treasury Secretary Janet Yellen arrived in the southern Chinese city of Guangzhou late on Thursday and is set to travel to Beijing on Saturday.

Ahead of a scheduled meeting Friday with Vice Premier He Lifeng, Yellen met with Wang Weizhong, governor of Guangdong province, of which Guangzhou is the capital.

"Throughout my engagements with my counterparts, I will stress that a healthy economic relationship can bring significant benefits for both our economies," Yellen said in prepared remarks for her meeting with Wang. Rhodium Group noted that Beijing has expressed its awareness and called for more guidance in investment to prevent overcapacity."However, the solutions adopted will likely center on retiring obsolete capacity and letting the most uncompetitive companies shut down while continuing to support capacity expansion, innovation, and exports in others," the report said.

China is the world's second-largest economy behind the U.S. Growth in the Asian country has slowed in the wake of a crackdown on property developers' high reliance on debt for growth and alleged monopolistic practices by internet platform companies. Uncertainty about Beijing's policies for bolstering consumption and growth overall have weighed on business and investor sentiment.

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