China tones it down at Davos this time ahead of Trump tariffs
IN 2017, weeks after Donald Trump’s first presidential election victory, Xi Jinping became the first Chinese head of state to address the World Economic Forum (WEF) in Davos, Switzerland – winning applause as he inveighed against protectionism and declared that a trade war would hurt both sides.
This time around, China’s presence at the annual Alpine confab of political, business and financial leaders is well toned down in the wake of Trump’s return to the White House. The nation’s top official at the forum is a vice-premier, Ding Xuexiang. And in contrast with Xi’s sweeping language more than five years ago, Ding struck a conciliatory tone, vowing to rebalance trade – an acknowledgement of a key concern for Trump – by promising to import more competitive, quality products and services.
The representation is also a downgrade from last year, when Xi’s top lieutenant, Premier Li Qiang, made the trek to Davos to assure the global elite that China’s economic stewardship of the world’s second-biggest economy would ensure that its 5 per cent growth target would be reached.
This year’s gathering comes as Beijing awaits a full picture of the Trump administration’s plans for bilateral ties. An apparent reprieve from the US leader’s highly anticipated tariff rollout lasted some 24 hours before he warned that a 10 per cent levy could be imposed on China as soon as Feb 1.
“It was inevitable that China would wish to play a lower key role, because they simply could not know what the outcome of the election was going to be,” said John Quelch, executive vice-chancellor of Suzhou, China’s Duke Kunshan University. Attending his 11th WEF at Davos, Quelch noted Chinese government and business presence this year was subdued on public-facing platforms such as panels.
Indeed, as companies with globally recognised names unveiled large shop-front banners and logos up and down the promenade at Davos at the opening of the forum, there was one well-known firm that remained hard to spot, shielded behind a vast white awning: TikTok, the social media giant owned by Beijing-based ByteDance, which now has a question mark hanging over its US operations.
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One TikTok staff member welcomed visitors to the firm’s stand. But its somewhat out-of-sight status underscored a muted presence that amounted to one of two key takeaways for one executive attending the forum. The second: a contingent of delegates rethinking how to approach business with the Asian nation as it enters a period of slower growth and geopolitical tensions. Despite the sobering reality check, there’s a realisation that China cannot just be ignored, said the executive, who did not wish to be identified discussing private conversations.
Another Davis attendee similarly noted that the Chinese delegation appeared less visible than in previous years. Neither had any plans to meet with officials, but both said that behind-the-scenes engagement between Chinese private enterprises and global firms remained active this year.
Uncertainty over what to expect from Trump was reflected in public discussions during the opening days of the forum. Vice-Premier Ding, speaking before the US president, levelled his latest 10 per cent tariff threat, warned against protectionism and trade wars, though he did not single out the US by name.
Ding also recalled a Chinese proverb that what a man says and does tells you who he is, saying that “China is a responsible major country and firm defender and builder of the international order.” That saying was reiterated by former People’s Bank of China deputy governor Zhu Min, who told Bloomberg TV it was necessary to wait and see what Trump does. “You never know. For Trump, the unpredictability is the key issue,” he said.
Davos delegates struggled to agree over even the broad direction for US-China ties in Trump’s second term.
Eurasia Group’s Ian Bremmer firmly disagreed with an assessment from Graham Allison of the Harvard Kennedy School of Government that relations would surprise to the “upside” by this time next year. Allison argued that it’s even hard to classify Trump as a hawk.
While China’s presence was downgraded, the government’s soft-power charm offensive was still on show this week. An evening reception hosted by officials from the northern city of Tianjin drew hundreds of delegates with lengthy queues to try local foods such as noodles with fermented soybean sauce and fried egg-stuffed pancakes.
The offerings were so irresistible – at a forum where tight schedules and hard-to-book venues mean dining opportunities can be scarce – that Ukraine’s First Deputy Prime Minister Yulia Svyrydenko and her aides were among the last to leave as they enjoyed several rounds of pork dumplings. BLOOMBERG
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