In a speech at the World Economic Forum in Davos, Switzerland this morning, Chinese President Xi Jinping never uttered Donald Trump’s name, but his message for the U.S. President-elect was clear enough. Xi, who is the first Middle Kingdom head of state to address the annual gathering, kicked off the proceedings by quoting Charles Dickens’ A Tale Of Two Cities. “It was the best of times, it was the worst of times,” Xi said regarding the current contradictory state of the world. He might also have been talking about the rising tensions between Beijing and Washington. “No one,” he admonished, “emerges as a winner from a trade war.”
Among the executives Xi is traveling with are such major entertainment players as Wanda Dalian Group chairman Wang Jianlin and Alibaba Group founder Jack Ma, both of whom will address the WEF this week. Chinese companies are increasingly drawing the concern of cross-aisle Beltway insiders who fret over PROC ambitions in the U.S. — and Hollywood in particular.
Ahead of Xi’s remarks today, Wanda’s Wang made a splash when he told Reuters he intends to continue his offshore buying spree in the entertainment and sports sector. Speaking on the sidelines of the WEF, Wang said Wanda has earmarked $5 billion-$10 billion per year for overseas investment with the U.S. the top priority. He also said the company, which acquired Legendary Entertainment last year, is interested in buying another movie studio. Progress, however, has been slow given few are willing to sell. (Wanda was previously involved in talks to acquire a significant stake in Paramount, but Viacom kiboshed the deal.)
Despite those rising U.S.-China temperatures, Wang today remained confident Wanda’s investments will not be impacted. He told Reuters, “Certainly trade will be affected by the tension between the two governments. If I can lobby I’m willing, but I’m not capable of lobbying both.” He added, “We will go to invest in the U.S. and I believe they will not close the door to us but maybe they will have some regulations regarding trade.”
Trump’s PROC policy is as-yet unclear, but during the campaign, he vocalized interest in levying 45% tariffs on Chinese goods, pointed the finger at the PROC for taking America’s power and jobs, and accused it of currency manipulation.
In Xi’s speech, he defended globalization and shunned protectionism. He also sounded a warning that appeared directly leveled at the American President-elect, “Any attempt to cut off the flow of capital, goods, and people between economies and channel the waters into the ocean back into isolated lakes and creeks is simply not possible.” The comment drew strong applause from the international WEF attendees.
Trump has not responded to the speech on Twitter, but his adviser Anthony Scaramucci later spoke in Davos and reportedly declared, “President Trump could be one of the last great hopes for globalism.” He added that the new administration “does not want to have a trade war” with China.
That’s good news for the film business as all of this comes as the USTR will begin negotiating a new contract with China in February on behalf of the industry. Film may be a very small part of trade, but it’s also the most public.
Overall, today, Xi said China would “level the playing field” to make the market “more transparent and better regulated… China will keep its door wide open,” he said, adding, “an open door allows other countries to access the Chinese market and China itself to integrate with the world.”
A few days after he won the election in November, Trump spoke with Xi during a call in which Xi told his future U.S. counterpart that “cooperation is the only correct choice for China-U.S. relations.” Today, while speaking to the world at large, Xi said, “We should join hands and rise to the challenge.”