Xi Jinping is “desperate” to attract foreign investors as China continues to face abundant currency problems, a leading economist has noted.
The People’s Republic (PRC) has been rocked by a severe real estate crisis that has crushed the real estate sector and hurt home buying.
After years of competitive and anti-corporate policies, President Xi has been forced to adopt his stance and has introduced a captivating offensive to rebuild ties with the United States and the European Union.
China has raised numerous concerns among foreign companies and companies with the arrival last year of a revision of the anti-espionage law, further exacerbating the reluctance to deal with Beijing.
The Chinese leader has sent officials around the world to ease tensions with Washington, which remains deeply distrustful of the People’s Republic of China, as well as Brussels and Tokyo.
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In Forbes, economist Milton Ezrati said: “The purpose is to bring the economy to life by recovering, at least in part, the old foreign enthusiasm for China, an enthusiasm that once drove China’s immediate development.
“(. . . ) The Americans and Europeans gave him a positive, polite, and friendly welcome, but none of those efforts elicited a really broad response. Neither investment flows nor industry have increased much. “
But despite your efforts to bring the industry to life with key foreign partners, your track record risks undermining your efforts, Mr. Sanchez. Ezrati.
He argued that Xi’s tendency to use industry to threaten and punish potential competition would likely leave China facing primary difficulties in making its new policy work.
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Ezrati added: “Now Beijing is paying the price for such behaviour and is failing to get the compromise it wants. “
Last month, Washington imposed significant new price lists for Chinese electric vehicles, complex batteries, solar cells, steel, aluminum and medical equipment.
And Brussels also last week increased tariffs, or import taxes, on Chinese-made electric cars.
EU officials complain that Chinese carmakers are about to gobble up shares of the market by undercutting the costs of European car brands thanks to large subsidies from Beijing.
The planned price lists aim to point out the extent of excessive or unfair subsidies enjoyed by Chinese automakers.
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