On Sunday I came back from a week-long visit to China. And what a week it was. As the days passed, tariffs went higher and higher, stock markets tanked, recovered, then dropped and then recovered again. Not totally surprising, Trump blinked and hit the pause button on tariffs on all countries except China, but even by Friday he had exempted semiconductors and electronics in a sign he had overplayed his cards. As probably the only country, China has not called Trump asking for trade talks, and this came as no surprise to most people I talked to.
Meetings were with a mix of analysts, company managers, supply chain consultants, investors and old friends that have lived there for a long time. Apart from gauging the temperature on the trade war front, I was there to get a sense of sentiment on a range of issues, such as housing, China’s tech advances and what people thought about the recent efforts to boost consumption. The trip took me to Beijing, Shanghai as well as Suzhou, another major city around 90km West of Shanghai. Below I have highlighted 10 key takeaways from my discussions in close to 20 meetings and presentations.
10 key takeaways
- #1: China prepared to fight
- #2: Stronger self-confidence
- #3: Highly disruptive effects short term
- #4: Stronger stimulus, but no devaluation
- #5: No consumer boycott, and Elon Musk still a hero
- #6: Apple and Tesla last in line to be hit(?)
- #7: European companies see both risks and opportunities
- #8: Housing confidence improved, but problem not solved
- #9: China’s fast tech development to continue
- #10: Lifting consumption is a major task
