Visiting U.S. Treasury Secretary Janet Yellen has called for “friend-shoring” among allies and partner nations to lower economic risks.

During her visit to LG Sciencepark, the conglomerate's research and development complex, on Tuesday, Yellen stressed the need for friendly nations to boost economic ties among themselves by spreading manufacturing within the group in order to weather disruptions caused by global turmoil, a policy she refers to as “friend-shoring.”

The secretary said the policy will help insulate both American and South Korean households from price increases caused by geopolitical risks and stabilize the production and distribution of vital products, from medicine and semiconductors to electric vehicle batteries.

Noting that South Korea is playing a key role in manufacturing chips and batteries, she added that Seoul and Washington should share the burden and resolve the supply chain bottleneck through close cooperation.

Yellen also raised the need to introduce a price ceiling for Russian crude oil, citing energy market volatility driven by the Russian invasion of Ukraine.