Chinese Vice Premier He Lifeng met with several U.S. Treasury executives last month as Beijing seeks to build relationships ahead of President-elect Donald Trump’s plans for tariffs on China.
He Lifeng is one of China’s four vice prime ministers and the chairman of the ruling Chinese Communist Party’s Economic and Fiscal Affairs Committee.
According to state media, he met BlackRock Chairman and CEO Larry Fink in Beijing on Dec. 5 and Goldman Sachs President and COO on Dec. 4. ) with Mr. John E. Waldron. This follows a meeting with Citigroup CEO Jane Fraser on November 21, state media said.
Peter Alexander, founder of Shanghai-based consulting firm Z Ben Advisors, said: “The Chinese are exploring every possible avenue to gain access to the people currently in power in Washington, the Trump team. “There is,” he said. “Backchanneling is the method China operates in constructing communications links, and even prefers.”
Goldman Sachs said it was aware of the report. Two other financial companies did not respond to CNBC’s requests for comment.
President Trump is reported to have selected at least 10 billionaires for his Cabinet, two of whom have strong financial backgrounds, including hedge fund manager Scott Bessent for Secretary of the Treasury and Kantar for Secretary of Commerce. – Fitzgerald CEO Howard Lutnick has been selected.
“I’m convinced that Wall Street people coming into trade and finance will play a moderating role on the protectionist side,” said Clark Packard, a researcher at the Cato Institute. “It’s all relative, and I think there’s going to be some protectionist moves on the trade side. These will be the voices that will work to alleviate some of that.”
“Treasury in particular is quite concerned about market reaction,” Packard said. “The only thing that can really scare President Trump away from really aggressive policies [policy] That’s how the market will react. ”
U.S. stocks have been on a relatively rare two-year rally of more than 20%. Chinese stocks fell earlier this year, but rebounded in late September after the Chinese government signaled a shift to economic stimulus. Chinese authorities confirmed their support at a high-level meeting on Monday.
“Keep your options open”
Zhongyuan Zoe Liu, the Maurice R. Greenberg Senior Fellow in China Studies at the Council on Foreign Relations, said actions such as entertaining Wall Street executives and imposing export controls on critical minerals have left Beijing with no choice. He said he would leave it alone. “They’re preparing for the worst-case scenario.”
But he cautioned that financial institutions were unlikely to be able to do much to ease tariffs and tensions with the United States, saying, “Commerce and Wall Street executives, in some way or another, will be able to do anything that fits their profile.” “We will not give up opportunities in any market as long as we do so.” ” said Liu.
Chinese financial media summed up the meeting between He Lifeng and US executives as a signal of Beijing’s willingness to open up its financial sector and attract long-term foreign institutional investment. Chinese state media often portrays the influx of foreign capital as a symbol of support for the domestic market.
According to state media, the Chinese vice premier met with Invesco President and CEO Andrew Schlossberg in Beijing on November 12, and also met with HSBC Group Chairman Mark Tucker on November 14. did. HSBC said it had nothing to add to the report. Invesco did not respond to requests for comment.
Winston Ma, an adjunct professor at New York University School of Law, said the U.S.-China capital markets are “perhaps the most dynamic and interconnected aspect” of bilateral relations over the past 20 years.
“If cross-border financial relationships are constructive and cooperative, they can lead to MAPs, or mutual guarantees.” [prosperity]; otherwise, it would be MAD (mutually assured destruction),” Ma said, referring to the Cold War deterrence principle.
