For Musk and other foreign CEOs visiting China, silence is golden
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[June 07, 2023] By
Brenda Goh and Joe Cash
SHANGHAI/BEIJING (Reuters) - A veritable parade of overseas CEOs
including Tesla's Elon Musk and Goldman Sachs' David Solomon have made
their way to a reopened China in the last few months.
One notable common strand: they've not talked much in public about their
trips which have mostly consisted of meetings with government officials,
local staff and business partners. Media events and other public
engagements, once frequent before the pandemic, are now rare.
Even Musk, known for his unreserved banter on Twitter, was
uncharacteristically silent on a whirlwind trip last week.
In 2020, the billionaire celebrated the delivery of the first cars made
at Tesla's Shanghai plant with a dance on stage that was open to the
press. This time around, media were not invited to cover his plant
visit.
And while Musk has mentioned the trip in two posts since leaving, he
didn't tweet once while in China.
Goldman's Solomon has similarly been more low-key. In 2019, he gave
media interviews and participated in several forums. But during his trip
in March this year, his only known engagements were closed-door meetings
with regulators, China's sovereign wealth fund and at a university.
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The lack of information from Western CEOs and their companies about the
trips to China can be attributed to wariness given that U.S.-Sino
political and trade tensions have worsened to their lowest point in
decades, said senior staff at chambers of commerce and trade
associations.
President Xi Jinping's increasing focus on national security - in
particular a recent crackdown on consultancies and due diligence firms -
has also left many foreign companies uncertain where they might step
over the line of the law, they said.
Noah Fraser, managing director of the Canada China Business Council,
said visiting executives are no longer chasing new business
opportunities but are concentrating on maintaining existing
relationships and will often stipulate no press, big dinners or speaking
opportunities.
They appear to be keeping "their heads down and will have private
lunches where they can learn from people on the ground what's
happening," he said.
Before travelling to China, U.S. CEOs have been seeking advice about how
Beijing's expansion of its counter-espionage law could affect them,
according to the head of a U.S. trade association who declined to be
identified, citing the sensitive nature of doing business in China
currently.
The CEOs also want to know how to deal with Chinese government officials
and with questions once the trip becomes public, the association head
said, adding it was not in their interest to speak to media and run the
risk of being asked to comment on stances taken by Washington and
Beijing.
The EU Chamber of Commerce said in a statement that companies operating
in China have always exercised a certain level of caution and were now
adapting to changes in areas that might be deemed sensitive.
Tesla did not respond to a request for comment while Goldman declined to
comment.
China's foreign ministry said in a statement that the numerous visits
from U.S. CEOs were a "vote of confidence" in the Chinese economy. That
their trips were relatively low-key stemmed from what it called the U.S.
government's "wrong policy" of containing China, it said.
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![](../images/060723PIX/busine94.jpg)
Tesla Chief Executive Officer Elon Musk
leaves a hotel in Beijing, China May 31, 2023. REUTERS/Tingshu
Wang/File Photo
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With respect to concerns about its counter-espionage law, it was
China's right to safeguard national security through domestic
legislation, it added.
The U.S. Department of Commerce declined to comment.
SHOWING COMMITMENT
While U.S. President Joe Biden said last month he expected a thaw in
frosty relations with Beijing "very shortly", there is no denying
that tensions have soared this year with flashpoints including U.S.
export curbs on semiconductors and data security concerns.
That said, after three years of harsh COVID curbs that hampered
entry into China, foreign CEOs appear eager to get the lay of the
land.
Those travelling here in recent months have included Apple's Tim
Cook, Intel's Patrick Gelsinger, General Motors' Mary Barra,
Blackstone's Stephen Schwarzman and JPMorgan's Jamie Dimon.
Sixty-seven foreign business leaders attended the high-profile China
Development Forum this year, although that is still 20 fewer than in
2019.
"The idea is that you have to show sufficient commitment to the
China market if you're playing there," said Christopher Johnson,
president of China Strategies Group, a political risk consultancy.
At the same time, the CEOs need to do that "without setting off
alarm bells with the U.S. government, and it's a very difficult
task," he added.
JPMorgan and Blackstone declined to comment. Apple, General Motors
and Intel did not respond to requests for comment.
The few known comments by foreign CEOs whilst they were in China
have been in line with Biden's stance that he is not seeking to
decouple the world's two largest economies.
The foreign ministry quoted Musk as saying he was opposed to a
decoupling of the U.S. and China economies which he described as
"conjoined twins".
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JPMorgan's Dimon told the JPMorgan Global China Summit last week he
favoured East-West "de-risking" rather than decoupling, according to
a source from the event.
Daniel Russel, vice president for international security and
diplomacy at the Asia Society Policy Institute, said the difference
between de-risking and decoupling was a subtle but important one.
It "makes clear that the issue is managing the risk of dependency on
China rather than a determination to separate the world into two
competing spheres," he said.
(Reporting by Brenda Goh in Shanghai and Joe Cash in Beijing;
Additional reporting by Selena Li in Hong Kong, Zhang Yan in
Shanghai, the Shanghai newsroom, David Brunnstrom and David
Shepardson in Washington; Editing by Edwina Gibbs)
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