Speaking in Beijing during a panel discussion on sports in the context of US-China relations, Yao was asked about politics in reference to a 2019 incident when then-Houston Rockets general manager Daryl Morey tweeted support for the pro-democracy movement in Hong Kong.
Yao, a former Rockets centre, said "there's no way we can hide" from politics.
But "as people who were in this industry, we should understand better what is 'in' the game, and what is 'out' and we will do our best and try to avoid (politics)," Yao said.
China is home to a huge basketball fanbase, but it has not hosted an NBA game in five years since two 2019 pre-season contests were played in controversy following Morey's comments.
The NBA subsequently lost hundreds of millions of dollars as a result of being taken off Chinese television until 2022.
Yao said that what happened in 2019 was an "instant accident" and Morey stepped "into a minefield that he was not really familiar with".
"So the minefield is there, but... we should help each other to cross it," Yao said.
When asked by AFP if he thought NBA games would make a return to China soon, Yao -- who had quit as the Chinese Basketball Association head last month after seven years in the job -- said he was "not in control" anymore and could not answer.
"But I can tell you that basketball is very popular in China, with all ages, whether played on court, or just watched from a TV," Yao said.
"The fans love to see all kind of basketball games."
NBA commissioner Adam Silver said in October that he expects his league will once more play games in China, according to multiple media reports.
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© Agence France-Presse