We cannot allow countries like China to use their market position in key raw materials, technologies or products to disrupt our economy and exercise unwanted geopolitical leverage, U.S. Treasury Secretary Janet Yellen said in Seoul.

Her remarks came after touring the facilities of South Korean technology giant LG Corp during the final leg of her 11-day visit to the Indo-Pacific region, Reuters reported.

Yellen said the United States and allies like South Korea should focus on "friend-shoring", or diversifying their supply chains to rely more on trusted trading partners, strengthening economic resilience and lowering risks.

In her view, this would support the dynamism and productivity growth associated with economic integration and help insulate U.S. and South Korean citizens from price increases caused by geopolitical risks.

She noted that the pandemic and the war in Ukraine clearly demonstrated the need to address supply chain vulnerabilities and work to reduce congestion and shortages that have led to price increases around the world.

She suggested a way for the United States and its allies to preserve the best features of a rules-based global order while eliminating China's "unfair" trade practices and ensuring access to vital resources and products, from medicines to semiconductors to batteries for electric cars.

The key to a new approach to trade requires that countries properly consider the costs of overly concentrated supply chains, geopolitical concerns, and cost, rather than "overly focusing on costs".