Xi Takes Stage at Trade Expo as China and U.S. Edge Toward Deal
The speech comes as Xi and Trump work to assemble a “Phase One” trade agreement.
(Bloomberg) --
China’s Xi Jinping was expected to renew his pledge to open China’s markets as the country inches toward a trade deal with U.S. President Donald Trump.
Xi’s keynote speech at the start of a trade expo Tuesday morning in Shanghai is the Chinese president’s first opportunity to address global investors since the world’s two largest economies resumed trade talks in September. He is expected to reiterate reform commitments, including further opening up the country’s financial sector and forbidding forced technology transfers.
The speech comes as Xi and Trump work to assemble a “Phase One” trade agreement that will leave many of their thorniest problems to future negotiations. U.S. officials including Commerce Secretary Wilbur Ross have expressed optimism about the pact, which might include increased Chinese purchases of U.S. agricultural products, keeping its currency stable and further opening its financial market.
The China International Import Expo -- now in its second year -- is designed to showcase the country’s desire to shift its economy toward consumption by buying more foreign goods. While some 63 countries are participating in the event, including French President Emmanuel Macron, the U.S. and most other Western nations are either sending lower-level delegations or none at all.
Chinese Foreign Ministry spokesman Geng Shuang told a regular news briefing Monday in Beijing that the event wasn’t motivated by short-term goals. “The second CIIE again shows China’s reform and opening up is not an expedient measure, but a long-term consideration toward the world’s future and common development,” Geng said.
Although the first CIIE yielded hundreds of deals and agreements, especially in the energy sector, few have come to fruition, according to a report released Monday by the European Union Chamber of Commerce in China. Half of the expo’s surveyed participants managed to make deals last year, and many saw “no follow-through” as their partners failed to fulfill obligations, the report said.
“We expect this year’s event to be supplemented by concrete measures to facilitate further market opening and increase foreign investment, not by empty promises that we have heard many times before,” said Carlo D’Andrea, vice president of the European Chamber.
On Again, Off Again
When Xi addressed the first CIIE a year ago, he took some veiled swipes at Trump’s “America First” polices, denouncing “law of the jungle” and “beggar-thy-neighbor” trade practices. Since then, the two leaders have held a series of on-again, off-again trade talks interrupted by tariff salvos.
The trade war has increased pressure on the Chinese economy just as it was cooling from decades of unprecedented growth. China’s list of economic headaches also include factory-price deflation, a fragile financial system and spiraling food costs in the wake of a catastrophic disease epidemic among the nation’s pig herd.
Last week, Xi told a gathering of the Communist Party’s Central Committee that “the severity of risks and challenges we face is unprecedented,” according to the official Xinhua News Agency.
Chinese state media reiterated the country’s need for the removal of punitive tariffs to be included in any deal.
“For China, removing all the additional tariffs is a core concern that has not changed and will never change,” said Taoran Notes, a blog affiliated with the state-run Economic Daily. “Even if there is a first-phase deal, this core concern should be reflected.”
--With assistance from Carolynn Look and Dandan Li.
To contact Bloomberg News staff for this story: Peter Martin in Beijing at pmartin138@bloomberg.net
To contact the editors responsible for this story: Brendan Scott at bscott66@bloomberg.net, Karen Leigh
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With assistance from Bloomberg