Chinese President Xi Jinping promised foreign companies greater access to China’s financial and manufacturing sectors, pledging Beijing’s commitment to further economic liberalization amid rising trade tensions with the U.S.
In a speech that officials had billed as a major address, Mr. Xi said Tuesday that plans are under way to accelerate access to the insurance sector, expand the permitted business scope for foreign financial institutions and reduce tariffs on imported automobiles and ownership limits for foreign car companies.
Throughout his 40-minute address, Mr. Xi never mentioned the trade friction with the U.S. or President Donald Trump. His remarks seemed designed to offer some policy initiatives, if not concessions, while drawing a contrast with President Trump’s “America First” agenda and portraying China as a steady global partner committed to the international trade order.
“In a world aspiring for peace and development, the Cold War and zero-sum mentality look even more out of place.” Mr. Xi told the Boao Forum, a government-backed gathering of business and political leaders on the tropical island of Hainan.
“Putting oneself on a pedestal or trying to immunize oneself from adverse developments will get nowhere,” he said.
Washington and Beijing’s trade spat has become a source of financial-market turbulence in recent weeks and raised concern about an outright trade war that could drag down the global economy. President Trump has threatened to slap tariffs on as much as $150 billion in Chinese products, in an effort to cut the bilateral trade imbalance that the U.S. says favors China by $375 billion. Beijing, on the other hand, vowed strong retaliation and blamed the U.S. for wrecking global trade order.
In apparent, if unacknowledged, answer to some of the U.S.’s criticisms, President Xi said China would increase imports, improve the protection of intellectual property and provide a more transparent, rule-based environment for foreign investment. He also pointed to Beijing’s announcement late last year that it would raise foreign-equity caps in the banking, securities and insurance industries, and promised those measures would be implemented.
“We have every intention to translate the measures into reality sooner rather than later,” Mr. Xi said, though he didn’t provide a clearer timetable for those or the other measures announced.
Many of the initiatives Mr. Xi offered up have been previously proposed. That, along with the lack of definite schedules for action, drew some skeptical reviews from foreign business executives and Chinese researchers alike.
Those factors also left the speech falling short of its billing by Chinese officials, who had said Mr. Xi would offer up important policy changes in suitable commemoration of the launch of China’s market-oriented reforms 40 years ago by former leader Deng Xiaoping. Those earlier reforms allowed China to benefit from globalization, paving for the country to become the world’s factory floor and, as Mr. Xi noted in his speech, the world’s second-largest economy and biggest trading nation.
Still, given the tit-for-tat tariff threats, some saw reasons for cautious optimism in Mr. Xi’s remarks. “President Xi was trying to strike a balance today,” said Myron Brilliant, executive vice president of the U.S. Chamber of Commerce. “President Xi spoke in terms of China’s own need and commitment for market reform and liberalization, but no doubt he was also sending a signal to the U.S. government that he wants there to be cooperation and dialogue, not conflict and a trade war.”
“Whether this message can help defuse bilateral trade tensions, we will see,” Mr. Brilliant said.
At the heart complaints by the Trump administration, as well as among some officials in Europe, are policies they say are at odds with Beijing’s earlier era of market liberalization. They point to continuing restrictions to access to the country’s market, as well as Beijing’s industrial policies that they say favor state-owned firms at the expense of private and foreign-owned ones.
President Trump has taken particular aim at what the U.S. calls unfair Chinese practices that force American companies to transfer technology and that permit cybertheft. In announcing a plan earlier this month to slap new levies on $50 billion of Chinese goods, the White House singled out items in biomedicine, aerospace, new-energy vehicles and others, mainly key components in a government initiative known as “Made in China 2025.” The program, backed by Mr. Xi, is designed to make China dominate the frontiers of manufacturing in coming decades.
China has denied such allegations and responded in kind, mainly targeting products made by farm states that helped Mr. Trump win the election in 2016.
While China has benefited from globalization, Mr. Xi and his government are in many ways ambivalent about unfettered interaction with the rest of the world. Mr. Xi is an unabashed nationalist, who believes in the Communist Party’s right to rule and resents the West’s lecturing on democracy, according to Chinese officials and analysts. Mr. Xi has sought to bulk up state-run companies and kept China’s internet isolated behind its Great Firewall.
Previous Chinese leaders, including Mr. Deng, sought to use foreign investment and competition to spur changes within the country. Under Mr. Xi, some Chinese officials and analysts said, the days when Beijing would make concessions to foster change are now gone.
“This time is different,” said Li Yang, chairman of the National Institution for Finance and Development, a government think tank in Beijing. Mr. Li pointed to the declining share of trade in China’s overall economy.
“We’ll open up the economy according to our own pace,” he said.
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