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Goldman on Greed, Google’s Next Trillion, COP27 Plan: NEF Update

China’s growing role on the world stage, climate change, and economic questions from inflation to cryptocurrencies were in focus.

Goldman on Greed, Google’s Next Trillion, COP27 Plan: NEF Update
Attendees during the Bloomberg New Economy Forum in Singapore. (Photographer: Bryan van der Beek/Bloomberg)

China’s growing role on the world stage, climate change, and economic questions from inflation to cryptocurrencies were in focus as global leaders of government, finance and industry gathered at the Bloomberg New Economy Forum in Singapore. 

Chinese Vice President Wang Qishan said China will keep opening to foreign investment, and stressed the importance of ties with America. But U.S. Commerce Secretary Gina Raimondo criticized the world’s second-largest economy’s trade practices, while signaling plans for a new Indo-Pacific initiative early next year. 

The three-day event in Singapore comes after Joe Biden and his Chinese counterpart Xi Jinping spoke on Tuesday to defuse tensions, and just days after a climate deal at the COP26 talks in Glasgow. Others speaking on Wednesday include Sundar Pichai, chief executive officer of Google parent Alphabet Inc.; and Lee Hsien Loong, prime minister of Singapore. 

Goldman Warns Exit From Pandemic May Be Rocky (5:45 p.m. H.K.)

Markets could face a rocky time as the global economy emerges from the abrupt impact of the pandemic, Goldman Sachs Group chairman and CEO David Solomon said. 

“When I step back and think about my 40 year career, there have been periods of time when greed has far outpaced fear -- we are in one of those periods of time,” Solomon said at the Bloomberg New Economy Forum in Singapore. “My experience says those periods aren’t long lived. Something will rebalance it and bring a little bit more perspective.”

Climate Financing is World’s Next Key Challenge (4:25 p.m. H.K.) 

Nations need to focus on effective climate financing for the developing world to maintain momentum after the Glasgow talks, said the cooperation minister of Egypt, which is scheduled to host COP27 in November next year.

“In order to move forward and achieve the targets we need the fuel, and that fuel is the money,” Minister for International Cooperation, Rania Al-Mashat told the Bloomberg New Economy Forum in Singapore. 

Rich nations are years behind schedule on delivering a $100 billion-per-year funding target, and that’s seen as only a fraction of what’s needed. “It’s embarrassing that we haven’t delivered that yet, and that’s only the small money -- we know we need trillions,” Dan Jorgensen, Denmark’s minister for climate, energy and utilities told the summit. 

Google Search, AI to Create Next Trillion of Value (3:00 p.m. H.K.)

Sundar Pichai, CEO of both Google and its parent Alphabet Inc., sees the group’s future as being in its oldest offering, internet search. 

Goldman on Greed, Google’s Next Trillion, COP27 Plan: NEF Update

Alphabet briefly surpassed $2 trillion in market value, and Pichai was asked by Bloomberg Television’s Emily Chang where the next trillion will come from. Consumers will ask computers more questions with voice and “multimodal experiences,” he predicted. “Being able to adapt to all that and evolve search will continue to be the biggest opportunity,” he said.

Most Google services have been kept out of China, and while Pichai doesn’t see that changing, he believes the U.S. and China have room to cooperate in areas like climate change and AI safety. 

He also said he doesn’t own any cryptocurrency. “I wish I did,” he said. “I’ve dabbled in it, you know, in and out.”

U.S. Plans New Asian Economic Framework (1:15 p.m. H.K.)

The U.S. intends to initiate a new economic framework for the Indo-Pacific in 2022, Raimondo said, as the Biden administration aims to reinvigorate America’s standing in Asia.

Goldman on Greed, Google’s Next Trillion, COP27 Plan: NEF Update

“We’re likely to launch a more formal process in the beginning of next year which will culminate in a proper economic framework” in Asia, she said at the forum. “I am here in the region beginning the discussions, laying the groundwork.”

It’s clear that many people in the region want the U.S. to rejoin the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, she said, while adding that “for various reasons that is not going to happen now.”

She also said the U.S. wants a “level playing field” with China. “China needs to play by the rules, they need to respect our IP, they need to live up to their commitments,” she said. “Right now for example, in the so-called Phase 1 deal where the Chinese committed to purchase a certain amount of aircraft and agricultural products, they’re not doing that, they’re not living up to their commitments.”

Don’t Forget Pandemic-Hit Developing World (1:00 p.m. H.K.)

Tanzania called for more support from the developed world, with more sharing of screening, testing and vaccine technologies, and more aid from the multilateral lenders.

“We ask the advanced world not to forget Sub-Saharan Africa because the challenge that we see is while advanced economies are recovering relatively faster because they have the vaccines, we don’t have the vaccines,” Tanzanian vice president Philip Isdor Mpango said. “The facilities that have been available to us are just too little. And the pandemic is global.”

His comments came at a panel on inequality and offered a sharp contrast to PayPal CEO Dan Schulman, who said the solution is “rooted in technology.” As everything moves to the Internet and mobile phones get cheaper and cheaper, he said, “you have all the power of a bank branch in the palm of your hand right now.”

Elizabeth Rossiello, CEO and Founder of AZA Finance, also said technology and access to financial services can support the flows that are crucial to growth in the African continent.

Singapore Senior Minister Tharman Shanmugaratnam noted 80% of Sub-Saharan Africa and South Asia lacks Internet access. “How do we improve internet access, how do we get learning inclusion, how do we raise standards, how do we have financial inclusion and access to credit for SMEs?” he asked. “Those are the big challenges of the world, not so much the incremental changes in costs of cross border payments and stuff.”

Vingroup May Invest Up to $6 Billion in U.S. (12:45 p.m. H.K.)

Vietnamese conglomerate Vingroup JSC’s auto unit VinFast will invest as much as $6 billion in its planned U.S. electric vehicle factory, Vice Chairwoman Le Thi Thu Thuy told Bloomberg Television.

In the first phase, the company plans to invest $1.5 billion to $2 billion, VinFast expects to launch the EV factory during the second half of 2024. It has narrowed the factory’s location to “five, six sites,” Thuy said. The company plans to begin global deliveries of its electric SUVs at the end of 2022. 

UBS Chair “Skeptical” On Cryptocurrencies (12:15 p.m. H.K.)

UBS Group AG Chairman Axel Weber said he is “skeptical” of cryptocurrencies, in one of his strongest verdicts yet on digital currencies.

Goldman on Greed, Google’s Next Trillion, COP27 Plan: NEF Update

The idea of moving “payments from banks and cash to something that is an anonymous vehicle where both sides of the transactions are not known -- that will not survive,” he said at a panel discussion at the forum. Regulators will also not tolerate cryptocurrencies becoming “really big” given the unidentifiable nature of transactions, said Weber, a former head of Germany’s Bundesbank.

His comments come just as more banks are looking to expand into crypto. JPMorgan Chase & Co. and Bank of America are hiring for the asset class, while Goldman Sachs Group Inc. has started trading crypto futures.

Singapore Exchange Sees Unicorns, SPAC IPOs (12:10 p.m. H.K.)

Singapore Exchange is in talks for IPOs ranging from hundreds of millions of dollars to “unicorns above a couple of billion dollars,” Chief Executive Officer Loh Boon Chye said in a Bloomberg Television interview at the forum. 

The pipeline includes firms based in Southeast Asia and outside of Asia in industries including new economy companies and real estate investment trusts. “If market conditions hold,” Singapore could host its first SPAC IPO either by the end of this year or early 2022. 

Kissinger Says Xi-Biden Talks a Good Start (11:20 a.m. H.K.)

A virtual summit the week between Joe Biden and Chinese leader Xi Jinping marked a “good beginning” for the world’s biggest economies to avoid a conflict, said Henry Kissinger, who as secretary of state helped lead a resumption of ties with China in the 1970s.

“They now have to be followed by concrete discussions that lead in a direction both presidents have affirmed they want to pursue,” the influential U.S. diplomat and author told the forum in a conversation with Bloomberg Editor-in-Chief John Micklethwait.

“Both sides have to accept that a conflict between major technical powers of comparable capacities must not occur for the preservation of humanity,” Kissinger said. 

Australia Wants Talks With China on Trade (11:10 a.m. H.K.)

Goldman on Greed, Google’s Next Trillion, COP27 Plan: NEF Update

Australia will need to be able to conduct ministerial talks with China as part of a process for the world’s second-largest economy to join a regional trade agreement, Trade Minister Dan Tehan said.

“You have to able to sit down and work through specially on market access issues,” Tehan told Bloomberg Television. “So we would need some sort of ministerial dialog to be able to work through that market accession.”

Both China and Taiwan have asked to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, presenting member nations with a difficult choice -- admit one, both or neither.

Bankers Say High Inflation May Stay (11:05 a.m. H.K.)

The heads of two global banks, one from Asia and one based in Europe, predicted an uncertain time ahead for the world economy as inflation rises and persists. 

The world may see “uncomfortably high” rates of inflation for one to three years, UBS Group AG Chairman Axel Weber said at the NEF. Inflation is getting a lot more structural, DBS Group Holdings Ltd. CEO Piyush Gupta said at the event. 

“Let’s remember inflation is at a 31-year high, at least the data that came out of the U.S., and it’s clearly going to remain high for the foreseeable future,” said John Studzinski, managing director and vice chairman of PIMCO. There will be “a period of time where inflation is going to be very volatile.”  

‘We Can’t Live Like This’ Says Mittal (10:15 a.m. H.K.)

Goldman on Greed, Google’s Next Trillion, COP27 Plan: NEF Update

A poll showed that 68% of those at the forum said the shift to remote work would be the most enduring business impact of the pandemic, with 16% saying it would be the move to a greener economy. 

“Remote work is the norm at the moment,” said Sunil Mittal, the billionaire chairman of Bharti Airtel Ltd. “My own view is one year from now this poll would show a reduced percentage on remote work, and the green economy will get even more momentum.”

He bemoaned the fact that he would fly back from the forum to a Delhi that’s blanketed with smog. 

“We can’t live like this,” Mittal said. “We talk about 5 million people dying of the pandemic; we don’t talk about how many people have been choked around the world.”

Great Resignation to Stay, Mastercard CEO Says (10 a.m. H.K.)

The labor market reckoning that’s become known as the Great Resignation may stay for some time, Mastercard Inc. Chief Executive Officer Michael Miebach said. 

In industries that are in great demand, such as hospitality and healthcare, there is “a lot of competition for great people,” Miebach said at the forum. “In our industry, anybody who knows anything about AI, digital identity, cyber, hot skills, those are the people that are in demand and those are the people saying ‘I am feeling huge pressure everyday in what I do, can I do better, let me look elsewhere.’”

China Can’t Develop if Isolated From World (9:45 a.m. H.K.)

China and the world must work together to boost global economic growth, Vice President Wang Qishan said in a speech to the forum, vowing to continue opening up more to foreign investment at a time when more countries are raising barriers over national security concerns.

Goldman on Greed, Google’s Next Trillion, COP27 Plan: NEF Update

“China can not develop in isolation of the world and nor can the world develop without China,” Wang said Wednesday at the Bloomberg New Economy Forum in Singapore. “China will keep its arms wide open, provide more market investment and growth opportunities to the world.”

Wang, technically second-in-charge to President Xi Jinping, spoke a day after the Chinese leader held a virtual summit with U.S. President Joe Biden. The outcome was generally positive, with both sides agreeing to continue talks on a range of topics even as they continue to spar over issues like Taiwan

He was introduced by former U.S. Treasury Secretary Hank Paulson, who said he hopes that China will continue to embrace reform and be open to competition.

Xi-Biden Summit Seen Setting New Tone (9:35 a.m. H.K.) 

Yesterday’s Xi-Biden summit sent a “strong message that the two largest economies have to work together,” Henry Huiyao Wang, founder and president of the Center for China and Globalization, said in an interview on Bloomberg Television. 

Goldman on Greed, Google’s Next Trillion, COP27 Plan: NEF Update

He noted that Vice-President Wang’s speech to the NEF emphasized the importance of openness and the dangers posed by isolating China. The world needs to accept that China is developing very fast and give credit to the country for lifting hundreds of millions out of poverty. 

But he pushed for more global action to fight the coronavirus. “There’s a lack of leadership on the global fighting of the pandemic,” he said. “There’s a need for having that so we can facilitate travel, the movement of the people, and even for Chinese government officials to visit other countries and back and forth. So I think that should gradually open.”

China Tech Firms Say ‘You Can’t Kill Me’ (9:25 a.m. H.K.)

China’s technology industry is already recovering from Beijing’s sweeping crackdown, with founders and investors adjusting to the new reality, according to one prominent venture capital investor.

“The Chinese entrepreneurs, they have a ‘You can’t kill me attitude’ toward the government, and toward anybody,” Gary Rieschel, founding managing partner of Qiming Venture Partners, in an interview at the forum. “They’re fiercely competitive, the energy is phenomenal. All you can do is pick the best entrepreneurs.”

World Needs Action, Not Words, on Climate (9:00 a.m. H.K.)

The three day event was opened by Michael Bloomberg, the founder and majority owner of Bloomberg LP, parent company of Bloomberg News, who said the recent Glasgow summit was encouraging, especially because of a U.S.-China commitment to work together. 

But the former mayor of New York City warned that action is needed more than words. He has previously committed $500 million to Beyond Carbon, a campaign aimed at closing the remaining coal-fired power plants in the U.S. by 2030 and halting the development of new natural gas-fired plants. He also started a campaign to close a quarter of the world’s remaining coal plants and cancel all proposed coal plants by 2025.

The summit started at 8:30 a.m. Singapore (7:30 p.m. New York), and speeches and panels are broadcast live. You can sign up for our New Economy Daily newsletter here. The New Economy Forum is being organized by Bloomberg Media Group, a division of Bloomberg LP, the parent company of Bloomberg News. 

©2021 Bloomberg L.P.

With assistance from Bloomberg