Xi Jinping, Head of World’s Largest Communist Party, Champions Global Trade
Also, Trump's man in Davos says pulling out of global trade deals will be good for globalism.
On Tuesday, Xi Jinping, president of China and leader of the Chinese Communist Party, addressed the World Economic Forum in Davos. It was the first time a Chinese leader had ever done such a thing, but Xi made up for years of lost headlines by coming out as a champion — and perhaps even the champion — of global trade and the current international economic order.
Xi was heralded by “the global elite” for presenting himself as “the anti-Trump.” Eurasia Group’s Ian Bremmer called it a “success on all counts” on Twitter, later adding, “You know capitalism is in trouble when China’s the leading free-trade nation in the world. #Davos.”
Dr. Nariman Behravesh, IHS Markit’s top economist, said, “President Xi gave a very rigorous and articulate defence of globalization.” And Carl Bildt, former Swedish prime minister and minister of foreign affairs, tweeted, “There is a vacuum when it comes to global economic leadership, and Xi Jinping is clearly aiming to fill it. With some success. #wef17.”
In many ways, it continues a theme that has emerged since the election of Donald Trump. Chinese state media has warned the neophyte leader to uphold, not weaken, the existing international order. Still, the irony is rich, and not just because China has chafed at constraints in the world order for decades. Xi, however, as if anticipating such criticism, said in his speech, “China will foster an enabling and orderly environment for investment. We will expand market access for foreign investors, build high-standard pilot free trade zones, strengthen protection of property rights, and level the playing field to make China’s market more transparent and better regulated.”
When it comes to trade, foreign businesses in China face all kinds of restrictive policies, a lack of market access, and obligatory joint-ventures and technology sharing with Chinese firms. The United States and Europe have taken China to task inside the WTO scads of times for dumping cheap goods and competing unfairly. In many ways, the export powerhouse is a protectionist powerhouse.
Still, it may be the only game in town, unless Trump actually does become good for globalization. That was the line taken by Anthony Scaramucci, a Trump advisor who claims he sold his asset management business today, three days before inauguration, and the only one of the Trump team in Davos.
He explained that an “America First” economic policy could be good for the rest of the world: Wage growth at home, he said, is “gonna be good for the world” because purchasing power will filter back out of America’s borders and foster global growth. (It’s not really clear how tearing up trade pacts and threatening trade wars, as Trump and his team vow to do, would do anything other than massacre American buying power, but whatever. Also, though Xi said in his speech “No one will emerge as a winner in a trade war,” Scaramucci is confident the United States would win a trade war with China.)
“In a lot of ways,” Scaramucci said, the president-elect “represents a hope for globalism.” Which he does, in the same sense that, Xi Jinping represents a hope for multicultural internationalism.
Scaramucci also found time in Davos to meet with Kirill Dmitriev, chief of the Russian Direct Investment Fund, which the United States sanctioned in 2015. And he gave an interview to TASS, Russia’s state-run news agency, in which he said that Western sanctions against Russia were ineffective “because of Russian culture. I think the Russians would eat snow if they had to. And so for me the sanctions probably galvanized the nation with the nation’s president.”
Kremlin spokesperson Dmitry Peskov responded, saying, “Russians prefer to eat not snow, but very tasty delicacies made in Russia, of which we have more and more thanks to sanctions.”
At least, in a topsy-turvy world where Xi Jinping is the savior of globalization and “China will vigorously foster an external environment of opening-up for common development” while the U.S. president-elect slams NATO and Europe, there are still somethings on which you can rely: The Kremlin flak staying on message.
Update, Jan. 17 2017, 2:34 pm ET: This piece has been updated with quotes from Xi Jinping’s speech.
Photo credit: LAURENT GILLIERON/AFP/Getty Images