By David Lawder

BONN, Germany (Reuters). U.S. Treasury Sec. Janet Yellen has confirmed that she will push for the removal of tariffs on Chinese imports from the Biden Administration.

Yellen spoke at a conference in advance of a meeting of G7 central bank governors and finance ministers. He said that there are internal talks about punitive Section 301 tariffs that were imposed by Donald Trump on Chinese goods valued at hundreds of millions of dollars.

She said that some of these “seem to me to impose greater harm on consumers, businesses, and aren’t very strategic in the context of addressing real problems we have with China,” referring to unfair trade practices and national security concerns or supply chain vulnerability.

Reuters exclusively reported Tuesday that President Joe Biden would have to settle the heated dispute among his aides about whether or not to reduce tariffs in his effort to combat high inflation.

Although Yellen supports removing certain tariffs, sources say that U.S. Trade Representative Katherine Tai would prefer to leave them in place in order to create a China trade strategy that is more strategic and protects U.S. workers as well as China’s behaviour in international markets. The strategy could include the addition of new strategic tariffs.

The punitive tariffs on goods that can be subject to up to 25 percent have very little to do the Trump administration’s Section 301 investigation into China’s misappropriation and misuse of U.S. technology. China’s retaliation against Trump’s initial tariffs led to additional tariffs being imposed on consumer goods, including bicycles and apparel.

Many economists from both the government and business have suggested that China reduce its tariffs to combat high inflation due to COVID-19 supply chains disruptions. This would also help to tame food and energy prices spikes caused by Russia’s invasion.

Yellen said tariff cuts could help reduce inflation but not be a game changer.

“So, I think there is a case for inflation. But also because it would bring benefits to both consumers and businesses by… cutting some of them. We are having these conversations.”

She said that she respected the views she heard during the debates on tariff policy.

She said that “there are many valid concerns.” She said, “And we haven’t really sorted it yet — reach an agreement on where to go and where to be regarding tariffs.”