China President Xi Jinping promises foreign firms reform, opening up amid heightened US tensions
- In a letter to the Global CEO Council, Xi Jinping said China will deepen reforms and expand market opening up to create a ‘better’ business environment
- China-US tensions have risen again recently over the Hong Kong national security law and Xinjiang, with both Washington and Beijing threatening sanctions
China’s President Xi Jinping has promised that China will stick to its “peaceful development” path, continue reform and deepen the opening of its domestic market in a letter to top international business executives.
In a clear bid to win the hearts and minds of the global business community amid rising tensions with the United States, Xi’s letter to the Global CEO Council stated that the long-term economic fundamentals of the Chinese economy remain sound and “will not change” despite the impact of the coronavirus.
“[China] will provide a better business environment for Chinese and foreign enterprises [to help them] explore new opportunities and new prospects”, Xi wrote in the letter dated on Wednesday. “You’ve made the correct choice of putting down your business roots in China to seek development.”
“I hope you will uphold the concept of win-win and joint development to enhance communications and cooperation with Chinese enterprises”, he added in the reply to a letter sent by executives from 18 multinational that are members of the Global CEO Council, who had praised China and Xi’s leadership in controlling the coronavirus outbreak.
The controversial law, which came into effect on July 1, authorises the Chinese government to punish those individuals and companies that cooperate with foreign sanctions placed on Hong Kong officials or institutions.
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Even as tensions with the US have escalated, China has continued to stress it is open for business and that it welcomes foreign investors.
As politicians in Washington and Brussels harden their stances against Beijing, the Chinese government is trying to woo multinational companies with promises of business opportunities to avoid a total breakdown of relations and to maintain its role in global value chains.
However, Beijing’s charm offensive strategy targeting foreign businesses has lost momentum since the imposition of the security law on Hong Kong.
The Global CEO Council, a group of senior executives from 39 big multinational companies, was set up in 2013 by the Chinese People’s Association for Friendship with Foreign Countries, one of Beijing’s diplomatic arms, to improve Beijing’s ties with multinational firms.
Xi held a meeting with delegates from the group in Beijing June 2018, just before the Trump administration started the trade war with China.
American executives from UPS, Pfizer, Cargill, Prologis, and Goldman Sachs, among others, attended the meeting in 2018, during which Xi asked them to help fight “protectionism”.
Delegates from European businesses, including Thales, Alstom, Schneider Electric, ABB, Nokia, Volkswagen, Philips, and ArcelorMittal, also attended the meeting two years ago.
For some global businesses, the relationship with Beijing remains bumpy. Merlin Bingham Swire, the chairman and executive director of conglomerate Swire Pacific, the largest shareholder in Hong Kong’s flagship airline Cathay Pacific, scrambled to pay a visit to Beijing’s aviation authority in August 2019 after reports that a flight from Newark, New Jersey, to Hong Kong was denied entry into Chinese airspace.
After the trip, Swire Pacific issued a statement offering strong backing for the Hong Kong government amid the city’s protests and fired staff for supporting the anti-government demonstrations.