Apple CEO Tim Cook at the opening of a new Apple store in Shanghai, China, this week. VCG/VCG via Getty Images
China’s commerce minister met with top global executives from technology, finance and pharmaceutical industries ahead of a high-profile business forum in Beijing, in an attempt to boost slowing foreign investment amid geopolitical tensions.
Wang Wentao’s meetings over two days included those with Apple Inc.’s Tim Cook, and Kwak Noh-jung, chief executive officer of South Korean chipmaker SK Hynix. He also met the CEOs of Qualcomm Inc., the world’s biggest seller of smartphone processors, and Micron Technology Inc., the largest US maker of computer memory chips.
Foreign businesses’ direct investment into China last year increased by the lowest amount since the early 1990s, underscoring Beijing’s challenges to spur its economy. It also has to contend with a steadily accelerating outflow of manufacturing as Apple and other American brands begin to position new capacity in countries from India to Southeast Asia to mitigate risks from US-China tensions.
Wang is taking the opportunity ahead of the China Development Forum, which starts Sunday, to meet with the leaders of key companies. The annual event, begun in 2000, has been one of the few venues where foreign business chiefs could interact with China’s state leaders. Premier Li Qiang will deliver a keynote speech this year.
China is trying to counter US restrictions on its access to technology. Wang discussed cooperation on semiconductors with SK Hynix’s Kwak and said he hopes the company will continue to expand investment in China. Kwak said SK Hynix will keep pushing for greater development in China, which is one of its most important production bases and markets, according to the Chinese Commerce Ministry.
SK Hynix is the world’s No. 2 memory chip maker after Samsung Electronics Co., which is also from South Korea. US-China tensions, which include American restrictions on access to certain key products, mean the companies need to strike a delicate balance between the two countries to maintain production and sales.
Read more: The $9 Billion Chip Plant Stuck in Limbo of US-China Rivalry
Micron CEO Sanjay Mehrotra told Wang the company plans to expand investment in China, according to a government statement. The commerce minister told Qualcomm’s Cristiano Amon that China welcomes hi-tech companies to deepen investment in China.
Amon said he looks forward to China and US leaders creating stable expectations and a good business environment for companies. Geopolitical tensions have also soured foreign businesses on China, with JPMorgan Chase & Co.’s Jamie Dimon saying earlier this year that “the risk-reward has changed dramatically” in the country.
Trade tensions also heated up in recent months as Europe launched an investigation into Chinese electric vehicle imports over state subsidies, and moved closer to imposing additional tariffs. China subsequently launched its own anti-dumping investigation into brandy imported from the EU, a move seen as a retaliation against France, which supported the electric-vehicle probe.
Pharmaceuticals, Banks
Wang held a roundtable with executives from overseas drugmakers including Pfizer Inc. and Merck & Co. from the US, GSK Plc from the UK and Takeda Pharmaceutical Co. from Japan on Saturday.
In a meeting with Jean Lemierre, chairman of French lender BNP Paribas SA, Wang said China is willing to resolve trade disputes with Europe and urged the bank to play a positive role in the dialog. Lemierre said the bank is willing to facilitate such conversations.
French President Emmanuel Macron plans to host Chinese counterpart Xi Jinping in Paris in the spring. The European Union is considering a formal review of how widely its businesses use mature or lower-end chips from China, joining the US in flagging a potential risk to national security and global supply chains.
The US recently took more steps to ringfence and curtail its rival’s artificial-intelligence and semiconductor ambitions. Wang told Apple’s Cook when they met Friday that China is willing to work with the US to create a fair, stable and predictable business environment for American and Chinese companies.
Apple’s Cook said his company would invest further in applied research in China.
“We are continuing to invest in China, in the supply chain, in R&D and in our stores,” Cook said in a video clip of the meeting.
— With assistance from John Liu and Yujing Liu
Barbara Terrio is a seasoned business journalist, delving into the world of finance, startups, and entrepreneurship. With a knack for demystifying complex economic trends, she helps readers navigate the business landscape. Outside of her reporting, Barbara is an advocate for financial literacy and enjoys mentoring aspiring entrepreneurs.
