Panel: China's commitment to opening itself to foreign investors
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Daily news and analysis. We keep you informed and inspired. This is World Today. Hello and welcome to the panel discussion of World Today. I'm Ding Hen in Beijing. Chinese officials are intensively sending a message that China remains committed to opening up no matter how the external environment may evolve.

According to the latest information from the Ministry of Commerce, China has approved three wholly foreign-owned hospitals as part of a pilot program launched last year to expand access in healthcare, telecommunications and biotechnology sectors.

In the same program, 13 foreign companies have gained approval to provide telecom services, and more than 40 foreign-funded biotech projects have been launched. So why are China and foreign investors staying committed to each other? Is investing China, investing in the future? These questions and much more in this edition of the program.

To listen to this episode again or to catch up on our previous episodes, you can download our podcast by searching World Today.

So joining us now on the line are Professor Liu Baocheng, Director of the Center for International Business Ethics with the University of International Business and Economics. Harvey Zeldin, Senior Fellow with the Center for China and Globalization. And Dr. Zhou Sili, Associate Professor of Economics and Finance with University of Macau.

So thank you very much for joining us. Professor Joseph Li, to start with you, according to data from China's Commerce Ministry, foreign-invested companies contribute to nearly 7% of employment and about 14% of taxes in China. So what do you make of the role played by foreign investors in the Chinese economy today?

Yeah, that's a very good question. So starting from 2014, so actually we have a very important program called the China Connect. So that made actually the capital market to be open to the international investors.

a lot of important milestone because this is the first time when we have the capital market, even it is more but it's growing to be a very, I think Shanghai market is around the third or nearly the fourth

So I guess it's a very important thing because we have 5,000 firms listed and traded on this market together with Shanghai Stock Exchange and Shenzhen Stock Exchange. That kind of milestone has been, it has been 10 years almost after this connect. But after this, I mean, internalization of Chinese asset has been a very popular topic for those foreign investors.

But of course, before the China's capital market, there could be FDIs, there could be trades, there could be other kind of the tools, forms to collaborate. But I do think foreign investors are very important and they are growing to be very important in the future.

Let me add on that. They do not only contribute 7% of the employment and 14% of the tax revenue, but they also contribute one-third of the Chinese total export. Half of the high-manufactured equipments are handled by foreign-invested enterprises in China.

Beyond all these figures, they also bring advanced technology, management expertise, and also the bridges towards the entire global market network. And they help China to move up along the value chain. Two things are not very noticeable, but very important. One is that foreign investment enterprises in China now constitute more than 1 million. They are

They are the universities of many of the Chinese young startups who learned all the skills, get to know the global distribution network. They start up their own business, either in collaboration or in competition with foreign companies who used to be their employers. And the other is that their concerns, their complaints,

And also the strategic devices pushes China to go for the institutional reform so that China can be better known for the world and also better converge on the international norms in doing business with the rest of the world. So however, situation changes, the firm commitment

of foreign companies in China and also firm commit from Chinese policymakers are still getting very strong. Foreign investors are still playing a very, very significant role in China. To put it bluntly, there is no question about that.

So, by the way, Professor Liu, what do you think foreign investors are looking for in China today? Are they looking for, for example, a huge market to sell their goods or products? Or are they looking for a kind of manufacturing prowess that can enable them to produce their goods in a cost-effective manner? Well,

Their major promises have been converging. They used to be focused more taking advantage of the Chinese demographic dividend by leveraging cheaper labor, good disciplined workforce.

and even lower environmental standards, not to mention the number of tax breaks and other type of concessions China offers. But today they look at more about the Chinese market role in the global distribution network so that they are able to further resharpen their focus to deal

with the Chinese manufacturing by penetrating more onto the high value stuff like green development, artificial intelligence, biopharmaceuticals, and other type of advanced manufacturing.

And more importantly is the rising Chinese buying market that's attracted them more to produce locally, to hire locally, and to cater to the rising middle class in terms of the

luxury products, then the, with the further opening of the Chinese market in multiple sectors, more of the telecommunication, biotechnologies, and many research labs are

getting new attractive points for foreign investment within China. So Harvey, going to you, some people say foreign companies are shifting from a in-China-for-the-world model towards a in-China-for-China strategy. What is your take on this?

I personally think that there's a shift that's going away from in China for the world to in China for China. To me, that's because the trend reflects the evolving strategies of foreign companies in response to China's growing domestic market demand and to its growing, more prosperous and more demanding middle class.

You have to factor in that rising labor costs and global trade tensions and supply chain disruptions have also made exporting somewhat more challenging. So meanwhile, China's middle class expansion is driving demand for localized products and services.

Additionally, companies are now prioritizing local production, R&D, and marketing to cater to Chinese consumers' preferences and to comply with the various regulations. And you can say that this model ensures competitiveness in a market that's increasingly self-sufficient, and it's one that's less dependent on global exports and markets

on the ups and downs of the global trade situation. So, Dr. Zhou, going back to you, I mean, if we are talking about a shift going on here, I guess this is not something new. We began hearing those kind of observations recently.

during the pandemic or even before that, during the first round of the U.S.-China trade war launched by Donald Trump back in the year 2018. So if there is indeed such a shift, what do you think this would entail for Chinese homegrown businesses as well as foreign-invested businesses here in China?

Well, it's a very interesting and timely topic. So I guess your question could be, I mean, try to understand the question to be following steps like three ways. Yeah. So the first, I think those foreign investors are not only looking for the Chinese manufacturing, but they also seek for more global diversifications.

You must see some patterns in the past week that NASDAQ are shrinking while the Hong Kong market, they are bumping up.

So there could be some kind of the argument to say like, it is the rise and the Western down or something. But I think for financial economics, you must feel like there could be some diversification rather than those global market. Chinese market, I mean, financial market are very, very different from the foreign capitals.

So that means foreign investors, they can enjoy the benefits for allocating some kind of capitals in some alcohol companies, for example, Maotai or Media or those AI companies in China. So that was never found in any other countries, even with capital control put by the Chinese capital markets. So this is the first point. So the second, I think during the whole process,

what can Chinese firms or what should those Chinese firms do in order to embrace those foreign capitals. I think as well they needed to produce and to make more money, of course. But at the same time, they needed to improve their corporate governance. They needed to follow some global standards like intelligence, properties. They needed to have some change.

to make those foreign capital to understand how to make the wise use of these capitals, increase their corporate governance or the other kind of things. So that is my second point. So the third, I guess, also my recent work, not only foreign investors are investing in Chinese assets,

On the same way, I mean, Chinese investors, they are also looking for more opportunities outside. Because in Chinese capital market, we lack of those tech companies due to some regulations. So most of these capitals, including the reason reform on the qualified domestic institutional investor program, we are also trying to look for more kind of opportunities outside.

So I think these are the mutual benefits for both Chinese investors, Chinese firms, foreign firms, and also foreign investors. So let me add on that, Ding Hai, that the shift of their slogan focus from for the world into for China is viewed really with rather mixed feelings.

Positively, it says that they are going to further localize the operation and localize their sales destination, etc.,

On the other hand, it also reflects the geopolitical uncertainties that is going on. So therefore, they get more locked down for China taking advantage of its advanced infrastructure and even Chinese subsidies in supporting certain industrial sectors.

It sounds pleasing to the Chinese consumers. However, one thing they never change, you know, they work for themselves or for their stockholders. The other thing is that they sense the Chinese message. There is a rising nationalistic feelings, you know, where some of the government institutions produce policies to focus more on buying materials

made in China, and also Chinese consumers are favoring more of the localized brand. So this is there to cater to the Chinese cultural and political situation. But in the meanwhile, China is also seeking its new membership within the WTO's government procurement agreement. So there have been mixed readings over

Chinese opening or whether China is going to further strengthen its domestic manufacturing

and getting more and more independent or reducing reliance on global contribution. So therefore, they really wanted to place their bet on different tables so that they have more of their own operational resilience that can be further enhance their corporate revenue.

So, Professor Liu Baocheng, in your opinion, for foreign investment in China, operational foreign investors in China, what are their main issues of concern right now? For example, I guess you have already talked a little bit about government procurement. They're demanding equal treatment. And I guess the Chinese government has made some clear and explicit pledge in this regard in its latest report.

action plan to try to stabilize foreign investments in 2025. And other than that issue, are we also talking about, say, financing channels or IP protection or how easy the flow of their personnel can be here in China or across the borders? What is your observation?

One key outstanding issue is the equal treatment. You see that in the existing five-year plan, foreign companies, despite of their number, despite of their contribution, are not included in the Chinese economic entities in the plan. So therefore, I strongly advise that in the next five

which is the 15th five-year plan, we include them into the Chinese, the market operators getting integrated more with the private enterprises, state-owned enterprise all together.

The other is that the same level playing field in competition, for example, they are still deprived to a large extent of their access to government subsidies and the finance from state-owned banks, etc.,

And then another issue is still the intellectual property protection issue. Despite the fact that China has stepped up all the legislation and the judicial practices to further protect foreign properties, but right now the

new area like the data, visual video programs. These are really the new area they need to protect, including all the genetic coding issues. And then more importantly is the predictability because, you know, businesses do not, I think proper businesses do not speculate.

They operate on a firm, predictable landscape. So therefore, we need consistency. We need the coherence in order to give them the right type of confidence to be further committed to this market.

So, Harvey, actually... Can I jump in there for a second? It seems to me the world today outside of China is very volatile. We've seen what's happened in the election in the United States and some other places where there's a lot of unpredictability, a lot of hostility, a lot of things being thrown at China. So the external environment is not very positive and it's not very predictable.

The one thing that investors or businesses really require is as much certainty as possible. I think they're starting to see more certainty from the Chinese government. For the longest time that I lived in China, so for several decades, people have always talked about IPR protection and personnel issues and the things that we're discussing today.

And we can see that the government is moving better and better in terms of providing details and consistency to accommodate the foreign businesses. So I think the wind is blowing in the right direction.

So actually, Harvey, in a recent survey by the American Chamber of Commerce in China, nearly 70% of the consumer industry respondents plan to increase their investments in China over the course of 2025. And in a separate report issued by the German Chamber of Commerce in China, 92% of the chamber's

member companies said their operations in China would continue. How would you look at these recent findings?

I look at them very positively, especially after the uncertainty that we had during those years of COVID, that we had during Trump's first term and all the ramblings and backing and forth and up and downs that Trump was doing that he's now doing even worse, except we know what to expect.

So I think there's several reasons that foreign companies in China are planning to increase their investments there and to remain in China this year. I think first, there are so many global uncertainties with the ongoing global trade wars, the tariff wars.

And I think the companies are more positive recently due to the clear indications that China's consumer market, it's vast and it's growing middle class and robust infrastructure.

are all moving in the right direction. I think the foreign businesses can see that although it's not perfect, China's economic policies, such as easing market access, improving business environment, they're being protected by the government. And also, the government's focus is on innovation and technology, and that aligns completely with global business trends.

Companies, well, they're all aiming to capitalize on China's skilled workforce and competitive manufacturing capabilities. So despite the challenging geopolitical tensions and even internal regulatory changes that are being addressed, the potential for high returns and long-term growth that makes China an attractive destination for sustained operations and

expanded investments is certainly in the very positive territory. So aside from some black rhino or gray swan event, it's all speed ahead and all deliberate speed ahead going forward for more win-win cooperation, production, and business.

So, Dr. Zhou, the final question before we need to take a very short break. So actually, after China's central government issued an action plan to stabilize foreign investment in February this year, we have also seen multiple Chinese localities rolling out their own

localized measures to attract foreign investment. For example, in the case of Shenzhen, the city is providing monetary incentives to support foreign companies expanding their local operations or even setting up a regional headquarters in the city. So when you look at all this, do you think there is an element of competition between different cities, different localities in China in terms of attracting foreign capital? And if that is the case,

Do you think that is a good thing? Yeah, I also view it very positively. So I guess the competition, we are not afraid of those foreign giants to enter into China. For example, like Tesla. When I was in Shanghai teaching at Fujian University, there could be sentences like their war is coming.

They are more powerful, they are more kind of energetic and also they own those technology to enter into those Chinese market. We view this as a great challenge for them. But actually we need more kind of the talents like Elon Musk.

I mean, manufacturing, not political. So I guess this is a very positive signs for cities like Shenzhen, like Shanghai, like those big cities to compete and embrace the most high technologies from foreign investors.

So why did they do that? Why do they have those encouragement, monetary stimulus or certain kind of the tools to attract the foreign investors? It's because they have a view that they can change the local environment and improve the innovations, encourage those innovations here.

I think it's good. It's a very positive sign for China to allow more foreign firms operating in the Chinese market because we have a very big market here. So those foreign firms, on the one way, they want to look for the market, and the second way is they try to look for low energy costs or operation costs.

Even the labor cost is increasing, but they really enjoy the benefits for the cost they have never enjoyed outside of China, for example,

manufacturing like those transportations or the other things. Okay. Now let me add, but the dark side is that the competition between different localities can also provoke vicious cycle in which different cities are really offering excessive incentives in order to be more repetitive.

in their own industrial parks, et cetera. So therefore, I call on the government really to make further planning by synergizing different type of incentive operations of different localities so that because China has over 80,000 type of industrial parks and they are operating on a more of a homogeneous basis.

So how we can really shape different industrial parks, different cities with the right type of unique feature, taking advantage of their local resources is something that is important. I do appreciate the description on the positive side, but we also need to take notice of the vicious competition among different cities. Thank you very much. Let's take a short break here. Coming back, our discussion will continue. Stay tuned.

You are back with World Today. I'm Ding Hen in Beijing. Today we are talking about why China remains attractive to foreign investors. Joining our discussion, Professor Liu Baocheng, Director of the Center for International Business Ethics with the University of International Business and Economics,

Harvey Zoldan, senior fellow of the Center for China and Globalization, and Dr. Zhou Sili, associate professor of economics and finance with the University of Macau. Harvey, China is making consumption growth a cornerstone of the country's economic strategy in 2025. So what kind of opportunities do you think China's plan to boost consumption might create for foreign investors?

So, as consumer demand rises, sectors like retail, like e-commerce, like luxury goods, healthcare, entertainment, they're definitely going to expand.

and foreign businesses are eager to tap into China's growing middle class. It's a very diverse market. It's heating up and it's offering many, many opportunities for businesses that can meet the demand for them. And there's also a complementary force, and that's

China's push for innovation and for the digital transportation. So that itself is opening doors for foreign tech companies and areas like fintech, like AI and smart manufacturing.

So government policy supporting consumption upgrades, such as tax cuts and urbanization as well, are going to further enhance the market potential. And so our partnerships with local firms and investments in supply chain improvements are also going to be a key to capitalizing on this growth.

So I think if you look at this overall picture, that the future is quite positive. So Professor Liu Baocheng, in terms of equity investments, actually a number of foreign institutional investors have downsized or exited from either Hong Kong or the Chinese mainland markets over the past few years.

But now it is reported that their interests in the Chinese market have increased once again ever since this deep-seek artificial intelligence tech breakthrough. And when some analysts, for example, JP Morgan or Citi analysts, when they recently upgraded their recommendations for China equities,

One thing they cited was China's government support for the tech industry. What do you make of this phenomenon?

Well, one is that if we look at last year's figure in terms of foreign investment, there has been a deep dive down by over 29 percent in the total value. But in the number, that has been quite an increase by double digit of foreign entities registered in China, which shows that foreign investment are having a very closer look

on China and how policy would move. So they would take a seat, but rather hesitate to increase their investment. But this year, situation is getting more positive in that because the readings from the policies message

within the Chinese central government is getting more encouraging and more of the confidence are being beefed up. The more and more, not only verbal commitment, but rather actual practices by further opening, for example, the healthcare market,

opening the telecom market and tourist market and financial services, etc. So this is something that is real and very appealing.

The Chinese high-quality development program by beefing up the new quality productive forces are also getting more attractive. So therefore, there has been more of the perception of the Chinese investment environment.

and also more of the confidence in the Chinese tech sector. And also, they are also looking at more of the subsidies being delivered to support the Chinese high tech sector. So they do not really want to miss the chance. And

And then when the global marketplace are also facing more of the volatility, so China becomes again a hotspot for investment and becomes a strategic node in terms of the global distribution network. So Dr. Zhou Sili, actually when we talk about equity investments, things can sometimes get in

quite, say, transactional or opportunistic. That's the reality. But how do you think China can boost its attractiveness or global competitiveness to in the eyes of equity investors, especially those long-term equity investors?

Right, that's a good point. Also echo to Professor Liu's point as well. So I guess in order to have a long-term kind of the expectations for the Chinese stock markets or equity investors, they are looking for future revenues or they are seeking for sustainable future revenues.

So that is a key things if you are long-term investor, for example, pension funds, mutual fund or other kind of the fund managers they are looking for.

So there is some skepticism about whether those Chinese tech firms can be as strong as those US tech firms like Magnet System 7, like Navida, those representatives. But recent report from the Xiaomi company, one of the representatives for the Chinese tech top 10, they gave a very outstanding performance.

So they actually could be a very strong reason to long China, because we not only have Alibaba and Tencent, that is a previous stateless of these foreign investors. We also have some manufacturing firms like Xiaomi Media and also BYD, a very crucial to support for

for the potential growth. Even though in the past three years, we have a lot of microeconomics challenge,

which in the whole world, they are underestimating China's strong engineering talents. We have so many population of those engineers, not like the US training. Our universities are very emphasis on the math and also engineers like India and also the other kind of the emerging market universities. We have very strong preference over these engineer courses.

So I think the tail end is okay. But whether those microenvironment will keep improving, whether we are still open to the world, whether we are still encouraged for those private firms, and also we look eyes on those significant investment in R&D, in other things.

That is questionable. But I believe, like what I said before, Xiaomi's case will give the foreign investor a very strong confidence in investing in China, especially if you are long-term investors.

So I think in the future, I'm not saying that you should dump the US stocks. I think you should put some weight or the Chinese stocks on the weight for those global investors. That's my plan. Okay, I take your point. I have something to add to that. Yeah, yeah, sure, Harvey. I think we've seen a sea change in attitudes outside of China about China.

China's capabilities, its resources, its productivity. And I think that's why DeepSeek made such a deep impression, both inside of China and outside. So you have to think that before DeepSeek, the main point of view, the prevalent point of view outside was, oh, China, they're good at making things, but they're

They're not innovative. They're stealing IP. And they don't have what it takes for the long term. Well, I think that's all been blown out of the water. And you just have to look at the one company like DeepSeek and see how innovative it actually is.

it got to drop this bombshell, this AI bombshell a couple of months ago by doing things beneath the radar screen, doing them in their own way, doing unorthodox things like hiring social scientists and humanities majors to help make their products better and more useful to more people.

So I think that companies like DeepSeek are in the vanguard of what's coming out of China now. And that's going to be more high level and more efficient and more creative productivity. And I think it's going to put to rest this old myth that China is just a bunch of lazy copycats. Because China is anything but.

And so I think we can say that what we've just seen with DeepSeek and a few other companies does mark a sea change going forward. And it is going to be the current that brings much more foreign investment here and much more desire by foreign companies to be able to cooperate

for win-win product development and things like that. So even though we think about this terrible situation in world politics with Trump and all that stuff that's going on, you can see this sea of creativity and stability right here in our own backyards. And I think that's very encouraging. And there's going to be a lot of wind in that sail and Trump or nobody else is going to be able to take that wind out of it.

So, Professor Liu, let me ask you this very relevant question. Some equity investors say the success of DeepSeek, for example, is one reason to be bullish on Beijing supporting the tech industry as a growth engine rather than simply focusing on monetary policy levers at China's disposal to grow the Chinese economy. In other words,

we're seeing some fundamental change in the growth pillar of China. Would you agree in this particular point? - Yes, China is going for rapid transformation from labor intensive industries more into the innovation driven industries. And this is the major trend that supports the continuous innovative operations at the business level.

The rise of deep-seek actually is not really because of the Chinese government direct monetary support, but rather because of the ecosystem that China is shipping to allow more of the young startups to go for the frontier technologies and, more importantly, to amplify their application into the user-friendly marketplace.

So, you know, what China is doing at the moment is that we try to enhance our policy consistency and increase our transparency.

And in the meanwhile, to improve the legal framework, because, you know, global investment, they are like birds, whether you have the right type of tree for them to flock and make a nest on that. So that's pretty much based on the business environment, the host environment.

the country can really offer. So they can be hot money and hit and run, and they can also be cool money by engaging more sustainable development and going for the government strategy for further innovation.

And the other is that China is highly committed to the carbon peak and carbon neutrality. And this offers tremendous chance, not only in the physical infrastructures, but also in the carbon trading and the new financial derivatives, etc., which in turn will also feed into the Chinese high-quality development with more of technological advancement. So this is really the

a large potential that needs to be further tapped and offer further attraction for foreign investment to participate into the Chinese equity market and also technological innovation. So Dr. Zhou, I guess when we talk about trade and investment, especially international trade or cross-border investment,

they are to a very large degree being politicized. I guess that's a new reality or a new characteristic in today's international landscape. So what kind of uncertainties do you think the U.S.-China tensions are creating for foreign investors in China?

Yeah, that's even a better question. So the trade tensions, I mean, that is a very big topic. So as we had a previous discussion about the global geopolitical tensions, I think China and the US, they are large enough to support each other's market. And if we are decoupling from the US, either ways will be suffered.

Of course, our outside environment is not that good, it's not that stable, but we cannot change whether and how the political think about it. So as a firm, we needed to adapt it. So I think we have a plan B for those firms looking for operating in China. For example, we are trying to expand the market access to the European or to the Africa.

But still, we got a lot of challenge than just seek for the US market because the US market, US consumptions

is super powerful to support the Chinese manufacturing. So without the US market, a lot of the business could be in trouble for Chinese firms. So that will in turn to harm on both sides. So the win-win solution approached by Hevy, most of all, I agree. I think this is a better solution. This is the first or the best. But if the geopolitical tensions continues, we need to seek about the second best.

So maybe in some of the bystander countries we can find some kind of solutions, saying that we can cooperate or maybe we can join venture in some ways. But I don't have a very positive views on how to solve it.

Another way to look at it is a trade war is not new. Even between China and the US, it's very popular now. But long, long time ago, US also had a trade war with Japan and with other countries as well. So maybe we can learn something from the previous experience from the trade war.

is maybe we can seek other ways, maybe in US or maybe in the other bystander countries to export to the rest of the world. So I don't have a clear viewpoint stance on both sides, but I do think cooperation is better because it's like the textbook theory tell you, competition are always good for, especially for consumer, right? But maybe not for producers,

But if we believe the competitive market, we should let the doors to be opened and embraced for the competitions. Let the doors open. So Harvey, with regard to this kind of concern or worry on the part of those multinational companies,

global executives, that's their companies, their businesses are getting caught in this crossfire of the U.S.-China trade war, which appears to be intensifying at the moment. Do you think China can address or alleviate this concern by moving to further open up the Chinese economy? I

I think there's a number of dimensions here. Yeah, of course those executives are getting buffeted. And we can see even the domestic executives in the United States are going daily to the White House and kissing Trump's ring and doing everything they can to say positive things about them. Even at the same time, they're quaking in their boots when they're in the Oval Office

because they never know what unpredictable Trump is going to do. So I think Trump's actually done the world a favor in a perverse way.

And that is that the world outside of U.S. has an opportunity to diversify their trade partners and their business partners because we know that we're now entering a multipolar universe. It's not going to be the U.S. alone.

that's the top dog. There's a number of other countries like China and political entities like EU, and there's a lot of other groupings in the Asia Pacific and so on that are ready to

make deals and cooperate, that the United States is not going to be able to control. And also, I maintain that while we're in a very dangerous period now, we shouldn't assume that Trump or somebody like Trump's going to be in office forever. Another thing that China and others should do, and we talked about it very briefly earlier,

is about WTO. Now, Trump's trying to shut down the WTO. China's trying to keep it open, and other countries are as well. The WTO is the agency

agency, international agency in the Bretton Woods system that really lit China's rockets and helped China's rise. And the WTO has a very important function in today's 21st century world for trade disputes and setting fair rules and things like that.

I believe if the business executives in the other countries and various governments can be more supportive of the WTO,

that it's going to blunt a lot of what the US is trying to do. And the last thing I want to say is that a couple of weeks ago, Wang Yi was at the UN and talking about reformation of the UN. The UN is at the top of the international political order globally. It does need reform. And China is taking a leadership position

the UN and UN agencies. And I think that's very wise, because so many of the things that we've been talking about today come under the United Nations umbrella. And I think China is going to be taking the leadership in organizations like UN and WTO, where the US is pulling back

I think in the long run, if we can get to the long run, this is going to be extremely positive. So Professor Liu, may I add something? So thanks, Harvey, for bringing this. So actually, our Chinese investors are very like Trump. They say that Trump pushed those capitals from Western pocket to Chinese market.

So that's a joke. So yeah, that's just a joke I used. So I'm not sure. I mean, for rational investors, we need more peace. We are also very tired about the Trump tweets as well. But nothing we can do. So we just adjust for the change. But maybe, so maybe those investors or also the experts, we can correct or recalibrate those Trump trade policies.

to make it less volatile or more stable, more predictable for those investors will be a plus for the whole world. So, Professor Liu Baochuan, how do you think China can make sure that the ways in which Beijing responds to U.S. tariffs does not end up hurting the confidence of foreign investors here in China?

Well, I think China is very firm and also committed to continued opening. And we recognize the major foundation for international trade cannot be severed by temporary U.S. policies. And the tariffs can hardly sever the entire

global trading system. The interdependence between China and the U.S. cannot be completely wiped off with Trump's magic wand in the tariff. The other is that we also need to

give more of the confidence and predictable environment to global investors because the U.S. policy does really create a favorable environment in which China can take advantage to host of the global investment by giving more of the

favorable policies. And more importantly, is that whether China is going to streamline some of the not only the barriers at the border side, but rather to have more of the cleaning part of more internal laundries in terms of the local barriers in

in way of doing business, moving resources across different regions. So pretty much dependent on how China is really performing, how China can continue to be more attractive to global investment.

China can really take a good chance to further reform its domestic market and boosting its attractiveness for global investment. So, Dr. Joseph Lee, the final question before we let you go. Earlier in our discussion, both Professor Liu and Harvey have emphasized the importance of

policy consistency, stability, and predictability in terms of stabilizing the confidence of investors. So in your opinion, how much does policy consistency, stability, et cetera matter to investors? Because

Obviously, we have kept hearing a clear message from Chinese officials that China maintains a very stable policy on trade or economic issues. And at a time when, say, the United States, namely the world's most powerful country, is making things more transactional between countries in terms of trade and other international affairs, how would you rate the importance of China's policy stability?

Yeah, that's a very important angle. So I think Pacific is very large. They can both have USA and China. But the problem is even the USA is very powerful, but they cannot stop China to increase innovations and also to increase the growth.

So I think we needed to be more investors actually hate for those uncertainties. You see the gold, the price has been rocked up in recent months. So review that we are actually risk on, not risk off for the global economies are worried about the uncertainties.

I think on the Chinese side, if we still needed to keep the long-term growth, we needed to have a so-called deep water reform. So we needed to try to make the economy more transparent, or maybe we improve the governance, not only for the firm, but also for the government.

to be more transparent, to be more open to either foreign capitals or maybe Chinese state-owned, also the domestic or private capitals.

In World Bank report, China is not a country's lack of the money. So we are actually freed as a capital abundant countries. We are not in lack of the capitals, but we actually lack of the foreign capitals because we have so many misallocations.

like those state-owned banks, they try to favor those state-owned firms, but not those private firms or foreign firms. So we need to have some deep-water reform to embrace competitions, but at the same time, we need to keep the transparency and stability of the policies

A lot of issues like real estate sectors in China needed to have certain kind of policies to inject to those investors, but also the strong support for those high-tech companies. I think this is a key point. And also we needed to be very careful on those capitals as well, because some of the capitals

They may be so-called hot bunnies. They could be burned and also could be looked for those hot topics.

But those manufacturing firms, especially private manufacturing firms, they are very lack of the capital. Even China is a capital-abundant country. So that's my judge. So hopefully I can add to the questions you ask. A big thank you to our panelists. Professor Liu Baocheng from the University of International Business and Economics, Harvey Zoldan from Center for China and Globalization, and Dr. Joseph Li from University of Macau.

That's all the time for this edition of World Today. I'm Dinghan in Beijing. Thank you so much for listening. Bye for now.