1
00:00:00,080 --> 00:00:02,720
Speaker 1: Media, China Cham and Duncan Clark joins me here on

2
00:00:02,800 --> 00:00:05,520
Speaker 1: the Singapore State at the New Economy Forum. I mean,

3
00:00:05,600 --> 00:00:08,800
Speaker 1: we've been listening there to the fact that Donald Trump

4
00:00:08,840 --> 00:00:11,720
Speaker 1: has formerly entered the U s presidential race and also

5
00:00:11,880 --> 00:00:15,080
Speaker 1: ed talking about China and Russia. We sort of thought

6
00:00:15,080 --> 00:00:17,320
Speaker 1: we might have an off framp between US China tentions

7
00:00:17,320 --> 00:00:19,960
Speaker 1: to with that meeting between presidents Biden and she. How

8
00:00:19,960 --> 00:00:24,439
Speaker 1: are you sort of landscaping the geopolitical landscape. Yeah, so

9
00:00:24,480 --> 00:00:27,280
Speaker 1: obviously the meeting didn't go badly in the sense that

10
00:00:27,440 --> 00:00:30,880
Speaker 1: it was cordial, but it doesn't really address the deeper issues.

11
00:00:30,960 --> 00:00:33,320
Speaker 1: It's maybe when you can call it some sort of botox,

12
00:00:33,360 --> 00:00:35,839
Speaker 1: if you will, for a situation where there's there's a

13
00:00:35,840 --> 00:00:38,239
Speaker 1: lot of a lot of pressure under the surface there

14
00:00:38,240 --> 00:00:41,600
Speaker 1: obviously from the technology war that you described, the trade war.

15
00:00:42,120 --> 00:00:44,520
Speaker 1: Interesting that you just mentioned if it's true that Trump

16
00:00:44,640 --> 00:00:47,479
Speaker 1: is formally declaring I mean this is was kicked off

17
00:00:47,520 --> 00:00:50,440
Speaker 1: really formerly by him, although Obama had, you know, ramped

18
00:00:50,479 --> 00:00:52,640
Speaker 1: up the pressure on China. But it's the one area

19
00:00:52,680 --> 00:00:54,840
Speaker 1: that the GOP and the Dems really agree on. It

20
00:00:54,920 --> 00:00:56,960
Speaker 1: is just maintaining pressure on China, so that won't change

21
00:00:56,960 --> 00:00:59,320
Speaker 1: either way. So it's it's an interesting thing. That's the

22
00:00:59,600 --> 00:01:03,120
Speaker 1: only thing that they can agree on at this China pressure. Yeah, absolutely,

23
00:01:03,120 --> 00:01:06,200
Speaker 1: but we're continuing to see the US China tech war

24
00:01:06,280 --> 00:01:07,959
Speaker 1: as well. It's kind of a matter of who's going

25
00:01:08,000 --> 00:01:10,680
Speaker 1: to blink first here too. It is I mean, you know,

26
00:01:10,800 --> 00:01:14,040
Speaker 1: we can talk about lose lose versus win win, which

27
00:01:14,040 --> 00:01:16,800
Speaker 1: perhaps we've lived in before. Um So, there's costs on

28
00:01:16,840 --> 00:01:19,280
Speaker 1: both sides for this. Uh So it's more of a

29
00:01:19,280 --> 00:01:22,679
Speaker 1: game of chicken in terms of who can maintain the pain.

30
00:01:22,760 --> 00:01:25,240
Speaker 1: And as we look at the semi conductor sector, we

31
00:01:25,280 --> 00:01:28,520
Speaker 1: see the pain ramping up over time for China. Of course,

32
00:01:28,560 --> 00:01:31,039
Speaker 1: it's also ramping up for US providers of capital, equipment

33
00:01:31,040 --> 00:01:34,240
Speaker 1: and other participants. But from a strategic standpoint in China

34
00:01:34,280 --> 00:01:38,840
Speaker 1: that's truly facing a big challenge. Sheeting Ping has clearly

35
00:01:39,040 --> 00:01:44,120
Speaker 1: enunciated his belief in indigenous innovation, the China's capacity to

36
00:01:44,319 --> 00:01:48,400
Speaker 1: innovate independently of the US and perhaps others, And so

37
00:01:48,440 --> 00:01:51,040
Speaker 1: that's the big bet. Will this bet payoff? Throwing lots

38
00:01:51,040 --> 00:01:53,560
Speaker 1: of money at the problem, will it be successful? There's

39
00:01:53,560 --> 00:01:56,080
Speaker 1: a lot of investor hope and optimism to the perhaps

40
00:01:56,080 --> 00:02:00,520
Speaker 1: the regulatory crackdown can potentially come to an air. What

41
00:02:00,680 --> 00:02:03,040
Speaker 1: is next then after the tech crackdown? And I guess,

42
00:02:03,040 --> 00:02:06,160
Speaker 1: how do we look at China tich right, And it's

43
00:02:06,160 --> 00:02:08,480
Speaker 1: perhaps instructives. Look at the property sectors. You've seen the

44
00:02:08,639 --> 00:02:11,280
Speaker 1: real estate developers have been hammered in China, uh and

45
00:02:11,480 --> 00:02:14,360
Speaker 1: seems like some easing over the last few days, extension

46
00:02:14,400 --> 00:02:17,959
Speaker 1: of certain deadlines of those policies. So perhaps that's precursor

47
00:02:18,000 --> 00:02:20,320
Speaker 1: to doing the same thing for tech, saying, you know,

48
00:02:20,480 --> 00:02:23,360
Speaker 1: the consequences of a downtown in the property sector, like

49
00:02:23,440 --> 00:02:26,160
Speaker 1: in the tech sector, is is pretty damaging, particularly when

50
00:02:26,160 --> 00:02:28,919
Speaker 1: you're maintaining the zero COVID or blanket overall, I kind

51
00:02:28,919 --> 00:02:31,360
Speaker 1: of make activity in China, So I think, you know,

52
00:02:31,400 --> 00:02:34,440
Speaker 1: we're probably the over the worst for the anti tech crackdown.

53
00:02:34,840 --> 00:02:38,400
Speaker 1: But the fundamental issue there remains, if they're private sector

54
00:02:38,400 --> 00:02:40,440
Speaker 1: tech companies in China, how does the government view them?

55
00:02:40,440 --> 00:02:43,120
Speaker 1: And we saw that famously with ant group the Ali

56
00:02:43,160 --> 00:02:45,880
Speaker 1: Baba spinoff two years ago without aborted I p O.

57
00:02:46,240 --> 00:02:49,200
Speaker 1: I think there is clear tension between the Communist Party

58
00:02:49,200 --> 00:02:51,520
Speaker 1: and the state on one hand, and these private sector

59
00:02:51,520 --> 00:02:54,040
Speaker 1: players getting too big if they can reach a new accommodation,

60
00:02:54,120 --> 00:02:57,240
Speaker 1: over control of data, over the sheer power of some

61
00:02:57,280 --> 00:02:59,520
Speaker 1: of these companies, which is a global problem. I mean,

62
00:02:59,560 --> 00:03:01,519
Speaker 1: look at tick Off, the debate about how powerful that is.

63
00:03:01,520 --> 00:03:03,919
Speaker 1: In China too, there's a debate about how big is

64
00:03:03,960 --> 00:03:06,240
Speaker 1: big tech, but it has a different flavor because of

65
00:03:06,240 --> 00:03:08,920
Speaker 1: the private sector element. China needs to figure out are

66
00:03:08,960 --> 00:03:11,120
Speaker 1: they going to allow private sector companies to become dominant

67
00:03:11,160 --> 00:03:14,040
Speaker 1: in certain years? If not, can they replace them? You

68
00:03:14,080 --> 00:03:17,080
Speaker 1: know you do? Sorry, excuse me, focus a quite closely

69
00:03:17,120 --> 00:03:19,240
Speaker 1: on Ali Barbera. I believe you have written a book

70
00:03:19,240 --> 00:03:21,079
Speaker 1: on Ali Baba as well. We know we're looking at

71
00:03:21,280 --> 00:03:24,840
Speaker 1: their earnings coming through tomorrow. Eleven eleven won't be reflected

72
00:03:24,840 --> 00:03:28,720
Speaker 1: in that not not a great shopping day for Ali Baba.

73
00:03:28,800 --> 00:03:31,880
Speaker 1: But but what happens to turn the consumer sentiment around here? Yeah,

74
00:03:31,960 --> 00:03:33,920
Speaker 1: so there's the number one thing is zero COVID. I

75
00:03:33,919 --> 00:03:35,880
Speaker 1: mean it is you know, if we see some maybe

76
00:03:35,920 --> 00:03:39,280
Speaker 1: Swiss Cheese approach to zero COVID. Now we're seeing certain governments,

77
00:03:39,320 --> 00:03:42,960
Speaker 1: local governments, not perhaps full the implementing, but we see uh,

78
00:03:43,120 --> 00:03:45,080
Speaker 1: you know, unrest. I think that this morning in Guangdo,

79
00:03:45,160 --> 00:03:47,760
Speaker 1: for example, where people are just fed up with us.

80
00:03:47,920 --> 00:03:49,120
Speaker 1: You know, I've been in and out of China on

81
00:03:49,160 --> 00:03:50,880
Speaker 1: and after the last two years. It is a painful

82
00:03:50,920 --> 00:03:53,400
Speaker 1: existence with the daily testing and the sort of uncertainty,

83
00:03:53,920 --> 00:03:56,800
Speaker 1: And it does seem there are signals now also reducing

84
00:03:56,840 --> 00:03:59,000
Speaker 1: quarantine for people coming in, you know, changing some of

85
00:03:59,040 --> 00:04:01,680
Speaker 1: the mechanics. Also, the sheer cost of maintaining the zero

86
00:04:01,680 --> 00:04:05,200
Speaker 1: COVID policy is stunning. I mean, the testing, the the

87
00:04:05,240 --> 00:04:08,560
Speaker 1: economic impact. So I think we're beginning to even though

88
00:04:08,560 --> 00:04:10,880
Speaker 1: they're maintaining the policy. I think we're gonna we're gonna

89
00:04:10,880 --> 00:04:12,839
Speaker 1: switch cheese our way out of this over time. Yeah,

90
00:04:12,840 --> 00:04:14,520
Speaker 1: it seems they're looking for an off ramp, But isn't

91
00:04:14,520 --> 00:04:18,160
Speaker 1: it when they're starting to slowly reduce some of those restrictions.

92
00:04:18,160 --> 00:04:20,800
Speaker 1: We've seen that twenty point plan as well. But when

93
00:04:20,800 --> 00:04:23,640
Speaker 1: you say you're going to unswervingly commit to COVID zero,

94
00:04:23,680 --> 00:04:25,560
Speaker 1: it's kind of hard to find that off roum. When

95
00:04:25,600 --> 00:04:28,279
Speaker 1: do you actually see a form reopening of China. Well,

96
00:04:28,320 --> 00:04:30,360
Speaker 1: some of it may be linked to vaccines, and again

97
00:04:30,360 --> 00:04:32,640
Speaker 1: this goes back to the indigenous innovation question. China has

98
00:04:32,640 --> 00:04:34,280
Speaker 1: been hoping that they can develop their own MR and

99
00:04:34,320 --> 00:04:37,400
Speaker 1: A vaccines from against state driven players rather than licensing

100
00:04:38,080 --> 00:04:41,120
Speaker 1: from same Madonna or Beyond Tech fiser as we've seen,

101
00:04:41,560 --> 00:04:43,839
Speaker 1: and again this anathema of having to work with private

102
00:04:43,839 --> 00:04:46,479
Speaker 1: sectors in China like Fu Soon, which had licensed Beyond

103
00:04:46,480 --> 00:04:49,760
Speaker 1: Tech for China, versus this dream of the state being

104
00:04:49,760 --> 00:04:51,440
Speaker 1: able to solve this problem. It's it's a question of

105
00:04:51,560 --> 00:04:53,880
Speaker 1: I had to say that really cliche, but face the

106
00:04:53,920 --> 00:04:56,240
Speaker 1: idea that a private sector of a foreign player is

107
00:04:56,279 --> 00:04:58,599
Speaker 1: going to solve this problem. I think that the costs

108
00:04:58,680 --> 00:05:00,880
Speaker 1: just mounting day by day, and so I think there'll

109
00:05:00,920 --> 00:05:03,120
Speaker 1: be some accommodation for some sort of licensing. There was

110
00:05:03,160 --> 00:05:06,040
Speaker 1: some discussion with the Chancellor Shortz's visit of some license

111
00:05:06,120 --> 00:05:08,880
Speaker 1: or some availability of vaccines to foreigners in China, but

112
00:05:08,960 --> 00:05:10,760
Speaker 1: that's the way out of this, I think formerly because

113
00:05:10,760 --> 00:05:13,839
Speaker 1: you obviously China is vulnerable otherwise, with an elderly population

114
00:05:13,839 --> 00:05:16,520
Speaker 1: with limited rural healthcare, they can't just open the gates

115
00:05:17,320 --> 00:05:19,760
Speaker 1: to COVID. When we look at when we look at

116
00:05:19,760 --> 00:05:21,520
Speaker 1: the steep slowdown in China though, I mean, there's so

117
00:05:21,520 --> 00:05:24,919
Speaker 1: many factors really affecting the geopolitical landscape. And we've been

118
00:05:24,920 --> 00:05:27,200
Speaker 1: talking about the war in Ukraine, We've been talking about

119
00:05:27,240 --> 00:05:30,240
Speaker 1: the increased pressure from Russia as well, and of course

120
00:05:30,240 --> 00:05:33,120
Speaker 1: as global inflation too. But does China's steep slowdown is

121
00:05:33,120 --> 00:05:35,800
Speaker 1: that one of the biggest impacts to the overall health

122
00:05:35,839 --> 00:05:38,479
Speaker 1: of the global economy. Well, strangely, if you think about it,

123
00:05:38,520 --> 00:05:41,200
Speaker 1: the zero COVID is actually repressing consumption and we have

124
00:05:41,320 --> 00:05:43,640
Speaker 1: more deflation in China. So one could argue that actually,

125
00:05:43,640 --> 00:05:46,200
Speaker 1: by China going out of zero COVID you would actually

126
00:05:46,200 --> 00:05:48,680
Speaker 1: perhaps see some inflationary impressures which would worsen the global

127
00:05:48,680 --> 00:05:50,960
Speaker 1: inflationary pictures. So at the moment, China is just a

128
00:05:51,040 --> 00:05:55,400
Speaker 1: very isolated situation. Reintegrating with the global economy is going

129
00:05:55,440 --> 00:05:57,520
Speaker 1: to take time, and it conferences like this, it's quite

130
00:05:57,520 --> 00:06:00,400
Speaker 1: apparent that the Chinese delicates are here, are are kind

131
00:06:00,440 --> 00:06:03,120
Speaker 1: of witnessing the fact that Chinese is not really very

132
00:06:03,160 --> 00:06:06,320
Speaker 1: present in terms of lots of debates in business investment,

133
00:06:06,560 --> 00:06:10,440
Speaker 1: investment flows beginning to go elsewhere, Supply chains are reforming

134
00:06:10,480 --> 00:06:12,920
Speaker 1: around China, and you know, the question is it's trying

135
00:06:12,920 --> 00:06:15,520
Speaker 1: to really fully committed to this you know, isolation or

136
00:06:15,520 --> 00:06:19,239
Speaker 1: to this separation of the domestic economy and the international economy.

137
00:06:19,480 --> 00:06:21,599
Speaker 1: And if they're not, they need to start beginning to

138
00:06:21,640 --> 00:06:24,840
Speaker 1: make moves. I think they're beginning to look at opening up.

139
00:06:25,160 --> 00:06:27,120
Speaker 1: It's going to take time. In twelve months time a

140
00:06:27,320 --> 00:06:31,080
Speaker 1: US China relations better or worse. And does that is

141
00:06:31,120 --> 00:06:33,720
Speaker 1: that impacted by whether or not we do see Donald

142
00:06:33,720 --> 00:06:36,880
Speaker 1: Trump as the Republican candidate. Yeah, I think the Trump

143
00:06:37,040 --> 00:06:39,320
Speaker 1: that's an interesting question, the analysis on that. I mean,

144
00:06:39,320 --> 00:06:41,680
Speaker 1: I think obviously the strong performance of the Democrats just

145
00:06:41,800 --> 00:06:44,360
Speaker 1: recently probably came as a bit of surprise to the

146
00:06:44,440 --> 00:06:47,760
Speaker 1: Chinese authorities, as did too many people that that going

147
00:06:47,800 --> 00:06:51,080
Speaker 1: into Bali, Biden is a much stronger player than they

148
00:06:51,120 --> 00:06:54,320
Speaker 1: had expected, potentially going beyond two years. Of course, they're

149
00:06:54,320 --> 00:06:56,560
Speaker 1: making that calculation. So a year from now, you know,

150
00:06:56,600 --> 00:06:58,960
Speaker 1: we're still going to be a year out from the presidentials.

151
00:06:58,960 --> 00:07:01,000
Speaker 1: It's still going to be unclear. I mean, I guess

152
00:07:01,000 --> 00:07:04,440
Speaker 1: the biggest factor will be events. Does anything happen with

153
00:07:04,520 --> 00:07:08,200
Speaker 1: regarding Taiwan, either statements on the Times government side or

154
00:07:08,240 --> 00:07:12,120
Speaker 1: the US side that or an accident that that precipitates

155
00:07:12,320 --> 00:07:15,520
Speaker 1: a crisis. Um, the hope is that this meeting you

156
00:07:15,560 --> 00:07:18,000
Speaker 1: know yesterday is reduced the temperature of it, but it

157
00:07:18,000 --> 00:07:19,960
Speaker 1: can easily flare up again. So it's still a very

158
00:07:19,960 --> 00:07:22,520
Speaker 1: precarious situation. Indeed, we thank you so much for your time.

159
00:07:22,600 --> 00:07:26,080
Speaker 1: Vid A China Chairman Duncan Clark with me here at

160
00:07:26,080 --> 00:07:28,880
Speaker 1: the Bloomberg New Economy Forum in Singapore,