Premier Li’s Summer Davos recipe tastes of hypocrisy
He talks of a ‘mega-sized consumption powerhouse’ as domestic demand stalls and exports explode
Premier Li Qiang dished up the usual Summer Davos slop during his opening address at the World Economic Forum talkfest in Tianjin. He spoke about making China “a mega-sized consumption powerhouse” after becoming a “mega manufacturing powerhouse.”
He also warned that the global economy was “undergoing profound changes,” and concocted a less than subtly rebuke of US President Donald Trump’s trade war. “The global economy is deeply integrated and no country can grow or prosper alone,” Li said on Wednesday.
Yet that is what Beijing has been trying to do for years, flooding overseas markets with cut-priced products and decimating domestic manufacturing around the globe. At the same time, consumption at home has shriveled after the property crash in 2020.
Across swaths of Europe and Asia, the alarm bells have been ringing for some time.
“Despite the rest of the world importing from it, China’s industrial capacity is simply too much to absorb,”Alicia García Herrero, a senior fellow at the Brussels-based think tank Bruegel, wrote in a report earlier this month.
China’s policy approach is tailored to further national interests.
MERICS
Dig deeper:
- Access to China’s roughly one billion consumers is becoming complicated, despite Premier Li’s claim that the world’s second-largest economy is open for business.
- A report released this week by a Berlin-based think tank, the Mercator Institute for China Studies or MERICS, illustrated the challenges facing European companies.
Delve deeper: “European firms and policy makers have been too slow to understand the impact of China’s shift to an innovation industrial powerhouse,” MERICS stated.
Between the lines: “China’s policy approach is tailored to further its national interests so foreign firms are met with different environments and incentives based on what they have to offer,” the think tank pointed out.
Big picture: But this hardly fits into Li’s script in the northern Chinese city of Tianjin, where he stressed that China would “open its doors still wider to the world.”
Bottom line: “We will further integrate and connect with the global market. We will not and shall not return to closed off and isolated islands,” he said.
China Factor comment: Still, Li was only parroting his master’s voice, Communist Party General Secretary Xi Jinping. He sees “economic globalization” as a “win-win” game. A major “win” for China and a major “win” for Xi.