Smart money in US still bets on Beijing

South China Morning Post

3 days ago

Wall Street and Washington don't always see eye to eye, especially over China. The White House of Donald Trump and politicians from both major US parties constantly issue warnings and threats against Beijing. Corporate bosses, however, have a very different attitude. Unlike politicians, they have the bottom line to worry about. Sensing a division, top Chinese officials have launched a charm offensive to reassure Western investors, but especially Wall Street bosses, that the country is open for business. Actually it's even more welcoming today, despite the trade war, uncertainties about its 90-day tariff pause, and the threatened ban against Huawei's most advanced chips.
Vice-Premier He Lifeng recently met Citigroup chairman John Dugan and Carlyle Group chief executive Harvey Schwartz in Beijing, and told them that the Chinese economy had shown 'strong resilience and great vitality'. It was the same point he passed on earlier to the chief executives of Apple, Nvidia and JPMorgan Chase.
Dugan and Schwartz's meetings with He came back to back. That was perhaps not an accident. The bank's history in China dates back more than a century, and Carlyle was one of the first foreign private equity firms to invest in China from the early 2000s. It has been a profitable partnership, as the Chinese learned the workings of private capital and investment. China always remembers its old friends. And Carlyle has a habit of retaining the services of top US officials who have retired, so its unrivalled political network is important to Beijing.
These top US bosses have reciprocated to China's goodwill. JPMorgan and Bank of America came under attack in April from the US House Select Committee on the CCP for being part of the team that underwrote the initial public offering of Chinese battery giant Contemporary Amperex Technology (CATL) in Hong Kong. Both banks ignored the warning, and CATL's successful IPO is so far the world's largest this year.
Meanwhile, Jensen Huang, the Nvidia CEO, has publicly declared Washington's global chip curbs on China a failure, having only forced the country to advance rapidly its own chipmaking capabilities.
Unlike Washington, America's corporate bosses understand the meaning of win-win.