(Bloomberg) – Chinese President Xi Jinping is expected to present his plans for a more innovation-driven and self-reliant economy on a tumultuous day for investors.
Xi is due to speak at the opening of the China International Import Expo on Wednesday in Shanghai, an annual event he has used since 2018 to promote China’s importance in world trade. His comments will be closely followed, given the backdrop to the US election result and the shocking pullback from what would have been the world‘s largest IPO, fintech giant Ant Group Co.’s listing in Shanghai and China. Hong Kong.
He is unlikely to address these events directly in his speech, instead sticking to China’s broad commitments to economic openness at a time when Beijing’s growth model faces growing challenges of economic development. from the United States.The trade exhibition comes less than a week after the ruling Communist Party presented development plans extending to 2035 that underscored the importance of technological self-sufficiency and stimulation of the internal market. Xi also stressed the ambition to double the size of the economy during this period.
Read more: Xi says economy may double as China presents ambitious plans
“There is no doubt that the recent emphasis on technological independence and ‘dual circulation’ is raising concerns among trading partners about the future direction of China,” said Shaun Roache, chief economist for the Asia-Pacific region at S&P Global Ratings in Singapore. “We expect the president to try to allay some of these concerns, but most observers will wait until the next five-year plan to get a clearer picture of where China is going.”
Xi has previously used the fair to reaffirm China’s commitment to economic openness and world trade order. At the first event in 2018, Xi announced a plan to set up a Nasdaq-style stock board in Shanghai, with the apparent aim of encouraging internal innovation and reducing reliance on American technology. The Star Board has since become the primary listing venue for major Chinese tech companies, with Ant due to debut there this week before the IPO’s withdrawal.
Xi’s speech on Wednesday night in Asia is said to take place hours after polling stations close in the U.S. While he generally avoids open references to the United States or its leadership, he took a peek veiled over President Donald Trump’s “America First” policy at last year’s exhibit, stating, “We need to tear down walls, not build walls. Democrat Joe Biden, a former supporter of engagement with Beijing, adopted a more critical tone during the campaign and pledged to enlist allies in a more coordinated effort to stem China’s rise to power.
China has sought to use the import fair to show its potential for demand for quality goods and services and attract foreign direct investment. Multi-billion dollar purchase deals have been signed at previous shows, although many have not come to fruition. The coronavirus pandemic has made it difficult to honor some of the contracts signed last year.
Many international companies, including leading players in the pharmaceutical, medical device, dairy, automotive and construction equipment industries, have registered to join the show, which also includes several seminars. and trade forums on the sidelines, Chinese officials said.
Senior executives of many global companies and foreign state leaders will only join via video links, and those who participate will face mandatory nucleic acid testing and temperature screening. Social distancing is also necessary – the government will ensure that the maximum number of people in the Western Shanghai Exhibition Center does not exceed 30% of its capacity.
“We expect President Xi to reassure his trading partners that his economy remains ‘open for business’ even as the Fifth Plenum confirmed the push for technological independence,” Roache said. “We expect him to reiterate that openness remains important for China’s development and that other countries can participate in China’s growth.”
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