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Chinese Vice Premier He Lifeng has met with several US financial executives over the past month as Beijing tries to build relations ahead of President-elect Donald Trump. tariffs expected in China.
He Lifeng is one of the four Vice Premiers of China and heads the Economic and Financial Committee of the Chinese Communist Party.
He met with BlackRock President and CEO Larry Fink in Beijing on December 5i Goldman Sachs President and COO John E. Waldron on December 4thaccording to state media. This followed a meeting with Citigroup CEO Jane Fraser on November 21ststate media said.
“The Chinese are looking for every avenue possible to gain access to those now rising to power in Washington. Team Trump,” said Peter Alexander, founder of Shanghai-based consultancy Z-Ben Advisors. “Back-channeling is how China operates, even prefers, when it builds communications lines.”
Goldman Sachs said it was aware of the reports. The other two financial firms did not respond to a request for comment from CNBC.
Trump has filled his cabinet picks with at least 10 reported billionairesincluding two with a strong background in finance: hedge fund manager Scott Bessent as Treasury Secretary and Howard, CEO of Cantor Fitzgerald Lutnick for the Secretary of Commerce.
“I think the people on Wall Street who are getting into trade and treasuries will play a moderating role on the protectionist side of trade,” said Clark Packard, a researcher at the Cato Institute. “It’s all relative because I think there will be something protectionist about trade. Those voices will be the voices that work to mitigate some of that.”
“Especially in Treasury they are quite concerned about the market reaction,” Packard said. “The only thing that can really scare Trump away from a really aggressive (policy) would be the market reaction.”
US stocks are on track for a relatively rare second year in a row gains greater than 20%.. After falling earlier this year, Chinese stocks rallied after Beijing signaled a shift toward stimulus in late September. Chinese authorities confirmed this on Monday support position in a high-level meeting.
“Keep your options open”
With actions like hosting Wall Street executives and imposing export controls on critical minerals, Beijing is keeping its options open, said Zongyuan Zoe Liu, who is the Maurice R. Greenberg Senior Fellow for China Studies at the Council on Foreign Relations. . “They’re preparing for the worst.”
But he warned that financial institutions are unlikely to be able to do much to mitigate the tariffs and tensions with the U.S. “Trade deals and Wall Street executives, one way or another, would not give up opportunities in any market as long as it fits their profile,” Liu said.
Chinese financial media summed up He Lifeng’s meetings with US executives as a sign of Beijing’s willingness to open up the financial sector and attract long-term foreign institutional investment. Foreign capital inflows are frequent broadcast by Chinese state media as a symbol of support for the national market.
The Chinese vice president also met with the president and CEO of Invesco Andrew Schlossberg in Beijing in November. 12and Chairman of the HSBC Group Mark Tucker on November 14thaccording to state media. HSBC said it had nothing to add to the report. Invesco did not respond to a request for comment.
U.S. and Chinese capital markets have been “arguably the most dynamic and interconnected aspect” of the bilateral relationship in the past two decades, said Winston Ma, an assistant professor at the NYU School of Law.
“When the cross-border financial relationship is constructive and cooperative, it could lead to it MAP stands for Mutual Assured (Prosperity); otherwise it will be MAD, Mutual Assured Destruction” Ma said, referring to a Cold War principle of deterrence.
