China Takes Backfoot. Wants to Woo U.S. Firms Fearing Trade Battle Could Slowdown Economy

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With a changed tone following Trump’s warning to impose sanctions the Chinese leaders have made changes in their earlier plan and wants to woo the companies from United States again. It is learned Beijing fears trade war may batter economy and curb critical investment.

Business consultant and chairman of the American Chamber of Commerce in China, William Zarit, said it is rational for the Chinese leaders not to kill the goose that lays golden egg.

When the Trump administration started ratcheting up tariff threats on Chinese products worth billions of dollars, China vowed to retaliate dollar for dollar.

However, lately Beijing wants to reassure the American companies that their China operations won’t be targeted in trade counterattacks.

Chinese official reveal Vice President Wang Qishan will be meeting senior executives from Blackstone Group, Citigroup Inc. and JPMorgan Chase & Co. over the weekend to discuss business.

About two percent of the foreign direct investment comes annually from American companies into China and some of the deals are in landmark sectors that help Chinese companies in imparting management know-how and improving technology.

Trump is taking a tough stand on China and lately has pressured the country by an additional tariffs threat on $267 billion of imports.

Meanwhile, it is also being said presidents of both the nations may meet on the sidelines of one of the global summits before the year end, but there is no sign of compromise by Trump.

China’s economy is world’s second largest and if foreign businesses shifts production to other countries, the economy would slowdown and related goals would be set back.

One of the government advisers said, “China can’t keep talking about reform and opening up without opening up to the U.S.”

Lately some of the U.S. tech giants have talked about shifting their manufacturing away from mainland if trade war tensions last for couple of months more.

Currently China is in need of foreign capital in sectors where its own companies are lacking know-how and fund like the energy sector in which demands have crossed the domestic supplies.

Some of the officials having knowledge of internal matter said China will be trying to offer help to lessen effects of tariffs to U.S. companies.

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