ANKARA

US Treasury Secretary Janet Yellen on Sunday met with Chinese Prime Minister Li Qiang to raise Washington's concerns about Beijing's excess industrial capacity, observing that bilateral relations are "now more stable because the two sides can have tough discussions."

Yellen, who is on a five-day visit to China, held an 80-minute meeting in Beijing with Li, who, for his part, urged Washington not to politicize economic issues but to take an objective view on industrial capacity, Beijing-based Xinhua News reported.

He said the two countries needed to respect each other and should be partners, not adversaries, adding that "constructive progress" had been made during Yellen's trip.

The US, Li added, should look at the capacity issue objectively and dialectically from the point of view of the market economy and from a global perspective, and on the basis of economic laws.

"We hope the US could work with China to adhere to the basic market economy norms of fair competition and open cooperation, while refraining from politicising economic and trade issues or overstretching the concept of national security," Li was quoted as saying.

Yellen said Washington and Beijing should not avoid “tough conversations” to manage their differences, adding that the meeting was "frank and productive."