U.S. Treasury Secretary Janet Yellen said Thursday that it’s “critical” the U.S. and China maintain a relationship so they can “work together” on global challenges, coming just after President Joe Biden’s remarks calling Chinese leader Xi Jinping a “dictator” drew condemnation from Beijing.

Speaking at a news conference in Paris, Yellen said that “with respect to the comments, I think President Biden and I both believe it’s critical to maintain communication … to clear up misperceptions, miscalculations. We need to work together where possible.”

“But we have disagreements, and we are also forthright in recognizing we do have disagreements,” she added.

Yellen has recently advocated for improving relations between the U.S. and China, arguing cooperation is needed for the sake of maintaining global stability.

Biden’s remarks at a fundraiser Tuesday, when he also said China had “real economic difficulties,” opened a new rift just after U.S. Secretary of State Antony Blinken concluded a visit to Beijing. The trip sought to break the ice in a relationship that has hit a historical low.

China delivered a formal protest of Biden’s remarks on Thursday, with Chinese Ambassador Xie Feng telling senior White House and State officials that Washington “should take earnest actions to undo the negative impact” of what Biden said or “bear all the consequences,” a Chinese embassy spokesperson said in a statement.

“With the latest irresponsible remarks about China’s political system and its top leader, people cannot help but question the sincerity of the U.S. side” in seeking to stabilize relations, the statement said. “The Chinese government and people do not accept any political provocation against China’s top leader and will resolutely respond.”

Meanwhile, speaking as a two-day gathering gets underway in Paris on improving the global financial response to climate change and poverty, Yellen said that “I’m certainly pleased to see China participating in this summit.”

Chinese Premier Li Qiang was among the dozens of heads of state and government, world finance officials and activists who converged on the French capital Thursday to discuss ways of reforming the global financial system and address debt, climate change and poverty crises, especially for developing nations.

“I believe it’s important, as President Biden does, that the world’s two largest economies are … working together in addressing global challenges,” Yellen said.

She also emphasized that debt restructuring was a U.S. priority.

As a growing number of countries struggle with unsustainable debt aggravated by the fallout from climate change, Yellen encouraged all creditors to enter into negotiations to make the burden sustainable. China is the world’s biggest government lender.

Citing Zambia, the southern African country she visited in January, Yellen said she was “encouraged by progress” regarding debt negotiations and was hoping “debt treatment can move forward soon.” She did not provide details.

“Other urgent pending cases must also move forward quickly,” she added, mentioning Ghana and Sri Lanka.

(AP)