WEF in China: Striving for a new normality

On the way from Beijing to the port city of Tianjin, it is impossible not to notice all the greenery. Endless rows of young trees stand to the left and right of over 100 kilometers (62 miles) of highway.

Across the country millions of trees have been planted as a way to help China achieve its environmental goals. And those efforts cannot be overlooked here.

Besides the six-lane highway, a high-speed train connects the capital and port. Numerous neighbourhoods lie in between. Gigantic skyscrapers reach out behind the trees, a number of which are still under construction.

For three long years during the Covid-19 pandemic, China was almost completely isolated from the outside world. Now they are the hosts of what is known as the “Summer Davos” meeting. Colourful posters hang everywhere in Tianjin.

The 1,500 participants from China and around the world are supposed to feel welcome at the World Economic Forum’s (WEF) Annual Meeting of the New Champions.

It is already the 14th event of its kind organised by the Switzerland-based WEF organisation. For the past three years, the meetings were held online because of the pandemic and travel restrictions.

This week the Chinese government wants to send an important signal with this international conference. It even made visas for foreign participants relatively easy to get, at least by Chinese standards.

China is actively courting investors. Many company representatives and politicians have come to Tianjin. But most of the big names are missing. Still, the organisers are happy about a significant number of company representatives from the US. There are also a number of European and African participants.

“The US and China account for 50 per cent of world trade,” emphasises Borge Brende, president of the World Economic Forum. That’s why it is so important to facilitate direct, personal exchange. To stress the idea of direct exchange, Chinese Premier Li Qiang’s opening speech was simultaneously translated into English, Japanese, Mongolian and Vietnamese. “The world economy is in a critical phase of upheaval,” he explained. “We should not return to isolation.”

China needs investors and open global markets to sell its products. Especially since the Chinese economy is growing more slowly than expected. In 2022, overall growth was forecast to come in at around 5.5 per cent, but in the end the economy only grew by 3 per cent.

Young people are finding it harder to get jobs. Experts estimate that every fifth young person entering the labour market here cannot find a job.

Chan Tran represents Linamar, a Canadian company that operates worldwide and has six production sites in China with around 2,000 employees. There they manufacture ccomponents for automobile production.

When asked about the current economic situation, the manager just shrugs his shoulders. In 2005, when the company came to China it looked like big growth was in its future. Now he fears stagnation.

“My company is a bit cautious with investments now,” Chan Tran says. So to hedge their bets, the company will just wait for a while and see how things work out.

And like many Chinese participants here at the “Summer Davos,” he prefers not to talk about politics. Even Premier Li Qiang skirted the subject, by speaking in very general terms, only mentioning an “intense political tension” that currently prevails.

He didn’t say a word about Russia’s war in Ukraine or tensions surrounding the situation in Taiwan. It seems as if the Chinese want to separate politics from business completely. It is a point that European and US participants, in particular, view critically. They talk about how they can reduce what they describe as the “China risk” — that is, their dependency on the Chinese market — but without giving up on the Chinese market altogether. But this is no easy task.

“We have politics hand-in-hand together with economics. You cannot disconnect the two,” says Frank Bournois from Shanghai-based China Europe International Business School. Nevertheless, he is convinced that investments in China still make sense. “If we are going with decoupling we would lose about 5 per cent of growth worldwide.”

Take cars. China is still the most important market for German automobile manufacturers. The streets of Tianjin are full of VWs, BMWs, Audis and Porsches. But more and more Chinese vehicles are taking to the roads too. Increasingly they are electric vehicles, the majority of which are now entirely produced by Chinese manufacturers domestically, and without much external support.

The scramble for market share is getting tougher and it’s not just German carmakers that are feeling the effects.

That is why the World Economic Forum is trying to promote dialogue, despite ideological differences. Though not everyone will always agree, at least representatives from around 90 countries came together in Tianjin to try.

And the need is there, say the organisers, especially since 70 per cent of economic growth last year came from Asia. Small discussion groups will take on big topics like artificial intelligence, biotechnology and the market for health care products.

The Chinese market has a significant share in these areas. Even if their share is less than the Chinese government had hoped, the country wants to continue to grow with future technologies.

One thing, though, perhaps didn’t go to plan. At the entrance to the convention centre, visitors were offered the writings of Chinese President Xi Jinping. Volumes bound and printed on glossy white paper. So far, demand has been limited.