SHANGHAI – A trade show hosted by China to promote a new image – as an importer – looks like a test of its commitment to enforce the promised economic liberalization.
In its recent economic initiative, Chinese President Xi Jinping opened an exhibition in Shanghai on Monday that focused on imports to convince trading partners that consumption is prevalent and that the # 2 global economy is increasingly buying from the world rather than selling it primarily.
"China has a huge market of over 1.3 billion people and it is our sincere desire to open up the Chinese market," Mr. Xi told his audience of more than a dozen foreign heads of state and heads of international groups such as the World Trade Organization and executives Hundreds of international companies.
Mr. Xi's remarks and the fair itself are intended to demonstrate Beijing's intention to rebalance the economy from practices that cause more than 80% of its trading partners to buy more from China than to sell. China's trade deficits were a lightning rod for successive US administrations, which was further deteriorated by imported Chinese goods due to unfulfilled commitments to market access to US dairy farmers, financial advisers, Internet companies, and other companies.
Mr. Xi's keynote, however, contained few new initiatives and largely reiterated the general support of globalization that he had expressed for two years, in part to contrast with Trump's economic nationalism.
Kenneth Jarrett, president of the US Chamber of Commerce in Shanghai, said Mr. Xi's statements on Monday and in the past two years are encouraging. He said the president has given rise to concerns about American companies, such as theft of intellectual property and the restriction of ownership of Chinese operations. "Rhetoric alone is not enough," he said.
Mr. Xi won applause, saying China will import $ 30 trillion worth of goods over the next 15 years. This represents a 25% increase over the $ 24 trillion import target that Mr. Xi promised in a speech last year. It also appears that the promise made since 2015 that China will buy goods from other countries worth $ 10 trillion will simply be extended for a period of five years.
Mr. Xi also said China will import $ 10 trillion worth of services over the next 15 years, a goal that analysts believe is easily achievable for a $ 12 trillion still-expanding economy, the last one Year imported $ 468 billion into services.
Expressing general plans with few details, Mr. Xi reiterated his growing belief that he is not planning the kind of bold transformation of the economy that has shaped his stance in politics – removing corrupt rivals and securing potential lifelong benefits yourself.
The European Chamber of Commerce in China has described a lack of economic policy follow-up as a "reform deficit".
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High-ranking officials have promised a series of policy changes throughout the year that would be suitable for the 40th anniversary of the switch to Deng Xiaoping's market-based reforms that made China an economic engine. "Some measures will exceed the expectations of the international community," said Liu He, the right-hand man of Mr. Xi, at the World Economic Forum in Davos.
Mr. Xi raised new hopes for liberalization last month as he embarked on a South Journey that reflected a 1992 Mr. Deng's voyage that promoted private enterprise, sparking a period of rapid growth. Mr. Xi used his trip to defend old government companies. Since then, in a public letter and meeting with entrepreneurs, he praised private companies praising their contributions, while state-owned companies remain the mainstay of the economy.
The China International Import Expo, the event that Mr. Xi opened on Monday, was promoted by officials and state media as a milestone in the country's interaction with the world. This also aroused the expectation among the corporate groups that he could use his stage to significantly reduce import tariffs or allow more foreign companies to do business without Chinese partners in joint ventures alone.
Instead, Mr. Xi said investors should be confident despite occasional "strong winds and storms" in China and that it is on the right track. "Openness has become a trademark of China," he said.
In addition to importing goods and services, Mr. Xi reaffirmed his commitment to better protect intellectual property abroad and facilitate restrictions on foreign investment in agriculture, mining, manufacturing, education and medicine. He said China would speed up the implementation of a law on foreign investment, even though it was a target of business groups saying that they want China to stop them from regulating more than local businesses.
Mr. Xi has not signaled any new impetus from the Trump government's collusion course that has called on China to reduce trade imbalances, stop the alleged theft of American technology, and stop discrimination against US companies.
To host the weeklong trade show in a new, stick-shaped building that calls China the world's largest exhibition center, the government said it spends hundreds of millions of dollars offering exhibitors the opportunity to show their merchandise to more than 100,000 professional buyers. Numerous government announcements prior to the first annual event called spending targets for Chinese companies and subsidies to support their purchases.
Although more than 150 US companies and organizations are participating, the Trump administration has put pressure on the fair and is calling for an open economy in a statement rather than sending a delegation.
Write to James T. Areddy at email@example.com