Seeking New Business Opportunities After Reopening
Apple and Pfizer CEOs Plan to Attend Boao Forum Next Month
[Asia Economy Reporter Kwon Haeyoung] As the United States shot down Chinese reconnaissance balloons that violated its airspace four times, escalating US-China tensions, CEOs of major global companies are visiting China one after another. They are seeking new business opportunities in the Chinese market, which is expected to rebound after the "reopening" (resumption of economic activities).
According to the Wall Street Journal (WSJ) on the 12th (local time), Apple CEO Tim Cook and Pfizer CEO Albert Bourla are reported to be visiting China to attend the Boao Forum for Asia, known as the "Asian Davos Forum," scheduled for late March. Mercedes-Benz also announced that Chairman Ola K?llenius plans to visit China.
Trips to China by global company CEOs were virtually "all stopped" for three years following the outbreak of COVID-19 in 2020. However, since China eased its COVID-19 lockdown measures starting December last year, a relay of CEO visits seeking the global manufacturing hub and largest market has continued. With optimistic forecasts that China will record a growth rate in the 5% range this year, these visits represent attempts to explore new business opportunities. China, in turn, expects increased investment from multinational companies to normalize economic activities and boost growth rates.
Oliver Blume, CEO of Volkswagen, was the first among global company CEOs to visit China after the zero-COVID policy. Following his visit in November last year, he returned to China in January this year, staying until early February. He is believed to have held a series of meetings with Chinese joint venture partners and Communist Party officials to discuss ways to expand Volkswagen's diminished influence in the Chinese market. China has been Volkswagen's largest market and a "cash cow," but fierce competition with local companies over the past three years has caused its market share to drop to about one-fifth. Ralph Brandst?tter, Volkswagen China President, said, "(The CEO's visit) sends a very strong signal to our regional partners" and "clearly shows how important the Chinese market is to us."
A large number of global company CEOs are also expected to participate in the upcoming Boao Forum in China next month. Of particular interest is Apple CEO Cook's visit, as Apple is reportedly considering relocating its production base outside China. After protests by workers at Foxconn's Zhengzhou factory in China, Apple's largest partner, in November last year over wages and COVID-19 lockdowns, Apple has been reviewing factory relocation plans. Attention is focused on whether Cook's visit will change these plans. He previously served as co-chair of the China Development Forum.
While global CEOs continue to travel to China, the geopolitical rift between the US and China is deepening. Starting on the 4th in eastern Carolina, the US has shot down unidentified flying objects that violated US and Canadian airspace four times. The first object was confirmed to be a Chinese reconnaissance balloon, and the remaining three are also suspected to be related to China. As the Chinese reconnaissance balloon flew over the US mainland, US Secretary of State Antony Blinken abruptly canceled his scheduled visit to China on the 5th and 6th. According to Chinese local media, Chinese authorities also detected an unidentified flying object off the coast of Shandong Province and announced plans to shoot it down. The Qingdao Marine Development Bureau informed the Jimu News that they are verifying the identity of the unidentified flying object after receiving a notification from the Qingdao Marine Development Bureau.
The WSJ analyzed, "Many people are wary of the US policy toward China," but "despite escalating geopolitical tensions, many Western company CEOs are seeking business opportunities arising from China's reopening."
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