In a recent address to top global business figures, Chinese President Xi Jinping issued a call for foreign investors to place their trust in China’s economic future. His remarks are part of broader efforts to rejuvenate the world’s second-largest economy, which has been hampered by a real estate downturn and a slowdown in economic vigor. Xi assured executives such as Akio Toyoda, chairman of Toyota; Lee Jae-yong, chairman of Samsung Electronics; and Stephen Allen Schwarzman, CEO of Blackstone, that China remains an excellent, secure, and promising investment venue for foreign entities.
While China continues to maintain its status as a leading exporter to various nations and offers a substantial internal market of approximately 1.4 billion citizens, an excessive expansion in the real estate sector has immobilized vast sums of capital. This has eroded both business and consumer confidence, siphoning the economy’s previous vitality. The ongoing trade conflict initiated by the U.S. further exacerbates these challenges.
In a landscape where private enterprises account for a significant portion of growth and employment within the predominantly state-run economy, these businesses have shouldered the brunt amid years of strict regulatory measures that have unsettled both entrepreneurs and investors. China’s stringent COVID-19 responses also led to lengthy business disruptions, with some sectors still struggling to bounce back, particularly those with ties to global supply chains.
Despite Xi’s reputation for being somewhat skeptical about welcoming foreign enterprises, he reassured that China’s openness to foreign investments will only intensify. “The policy of utilizing foreign investment has not changed and will not change,” Xi declared. He emphasized China’s vast investment and consumption potential.
China’s government has set an economic growth goal of about 5% for the current year, mirroring the previous year’s target—a goal that experts believe will be challenging to attain. Plans to invigorate the roughly $20 trillion economy include borrowing for diverse programs, providing incentives like 300 billion yuan in rebates for consumers to purchase newer cars and appliances. However, much of the capital will be directed to bolster the housing market and assist local governments burdened by debt.
The ongoing trade tensions with the United States cast a shadow over future prospects, with tariffs on Chinese imports raised twice under the Trump administration to 20% overall. While China has shown resilience, retaliating with tariffs on U.S. products, the future remains unclear. Although Xi did not explicitly reference these tariffs, he hinted at the necessity of stable trade relations, suggesting that “Blowing out other people’s lights will not make your own lights brighter. Blocking other people’s paths will eventually block your own paths.”
For now, China aims to present itself as a “safe and promising investment destination” for foreign stakeholders. Emphasizing the benefits of partnering with China, Xi declared, “Going with China is going with opportunities. Believing in China is believing in tomorrow. Investing in China is investing in the future.” Xi, who serves as the perpetual leader of the ruling Communist Party, asserted these points to the audience.
Attendees of the event included Amin H. Nasser, president of Saudi Aramco; Sherard Louis Cowper-Coles, chair of the China-Britain Business Council; Oliver Zipse, CEO of BMW; and Ray Dalio, a leading figure at the hedge fund Bridgewater Associates.