Chinese President Xi Jinping underscores strong confidence in high -quality development during his Henan inspection tour, Beijing criticizes Washington's attempt to ban Chinese chips, and Japan signals no rush for a trade deal with the United States.
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Let's begin today's show with President Xi Jinping's recent inspection tour of Henan Province, a trip that emphasized high -quality development and revitalization of China's Central Region.
During the tour President Xi called for strengthening the province manufacturing sector as a key driver of Chinese modernisation.
He also visited historical and cultural landmarks and held discussions with the local officials.
So to help us unpack the significance of this visit, I am joined by Dr. Yao Xiujie, Chongkong Professor of Economics at Chongqing University.
Professor, President Xi has constantly underscored the importance of Hunan's development.
Having made multiple inspection tours to the province, how should we interpret the timing and strategic significance of this latest visit?
Yes, I think next year is the 15th annual plan for the country.
So presidency is paying significant attention to how the five -year plan could be drawn.
So he had a very intensive visiting tool across the country.
Certainly, Henan province has a number of significance, partly and only because of the largest population among the Chinese regions and provinces.
Also, it has a very balanced industrial structure, agriculture, manufacturing and services.
and also the location along the Yellow Liver Ranch, which is the Yellow Liver, you know, ecologist system is one of the most important location, called China, to promote little economic growth and also improve the living standard and the living environment of the public.
So the visit to Henan have signify the importance of the easing and the attention by President Xi Jinping.
I think he not only paid a visit to the manufacturing base in Luoyang City, and also bearing in mind that he also is very interested in agricultural security, food security for China, which is one of the most important priorities for the central government.
Another significance is that because Henan Province is situated in the middle of China, which is in between the coastal area and the western area and the upsurgeance of the middle China region is certainly of very strategic importance for the national, regional economy to coordinate development.
So, this visit, I think, extends a very strong signal, not only to Henan province itself, but also to the rest of the country.
That he himself and also the central government is very interested in promoting regional balanced economic development, particularly in the most populous province, such as Henan province.
Professor, indeed, as you said, Hunan has long been known as a key agricultural base.
But today, it's emerging as a modern industrial hub.
Because President Xi's stop at Luoyang Bering Group, a Lexi factory now transformed into an advanced manufacturing firm, highlighted this shift. So what does the transformation of Luoyang Bering Group say about China's approach to upgrading its manufacturing base?
Yes, in terms of the modernization process of the Chinese economy, it certainly is featured with the two major factors.
One is the upgrading and also the quality improvement of the traditional industries in manufacturing.
The second is also the new productive forces, such as the digital technology and also the Internet of Things.
Now, Luoyang Balang Group is a very interesting area for attention because Luoyang Balang Group in the 1950s is one of the heavy manufacturing industry producing all kinds of baling for production industrial equipment and also the transportation, as well as train, truck, as well as the aeroplane.
Now, as the Chinese economy is deepening and the quality is improving, diversification or production not only rely on the transformation of the traditional industry such as the case of bearing group in Loiyang.
And Loiyang is transforming from the traditional manufacturing to one which now have been heavily diversified into all kinds of key areas that is desperately needed for the Chinese modern industry.
And it is also integrated into automation, digital control and AI.
This makes the Luoyang in the old factory become really vibrant to meet the need of the modern industrialization process.
So, paying attention to Luoyang Bailing Group is really important to reflect President Xi Jinping's emphasis on the so -called new productive forces to join the socialist modernization.
Professor as you just touched upon earlier, we are also witnessing a larger structural transition with manufacturing activities gradually relocating from China's coast to its interior.
Henan, with its transportation links and labor pool, is clearly a beneficiary.
So how does the rise of Henan and the central region more broadly fit into China's coordinated regional development strategy today?
And could this be a sign of a more balanced national economic layout in the years ahead?
Yes, I think we will just give some examples to start with.
For example, like you know, in the end of the last century and earlier of the century before the world financial crisis, Chinese manufacturing hubs are basically located in the city along the coastal area.
Those factories, they are largely the so -called export processing, labor intensive labor processing, relatively low value added for the coastal cities.
But as coastal cities become more innovative and also the industrial structure have been transforming from the lower and middle rank to the upper rank of the industrial system, part of this manufacturing base have to be transferred from the coastal area to the rest of the country, rest of the country, including central China.
And where this fairly labour -intensive industry goes, I think certainly they go to Henan, because where, as I mentioned, is the most populous province in China, certainly you have an abundant supply of labour, particularly in Zhengzhou we used to have the foxconn and also the manufacturing of chips and automobile and other things which are traditionally one of the key industrial processes in the coastal area.
Nowadays it becomes a prominent presence in Zhengzhou and also the rest of the Henan Now, certainly, this is the natural transformation process, this is certainly a natural coordinating regional balance growth.
The growth momentum goes from the coastal area to the central and the western area and it reduces the productivity gap between the coastal area and the inland area and it also reduce the income equality to help countries' economic conversions, so that all the production factors across the country can be invigorated to a higher level.
And this is certainly a process.
Henan province just a fairly significant example for these kinds of industrial transformations and also into regional balances." Henan is also becoming a symbol of China's domestic circulation and international connectivity goods from Europe and South America now flow through Zhengzhou within hours.
Given Hunan's growing logistical capabilities and foreign investment attraction, what role can you play in China's dual circulation strategy, especially as the country faces external uncertainties today?
Yes, I mean with the China -Europe railway and also with the China western gateway to the sea and also the Southeast Asian country market and the rest of the world, the transportation system within China has been largely promoted because of the highway system, because of the high speed rail system, and also air transport in this case.
Now because the Henan province is situated right in the center of the country.
So everywhere you go to the Chinese domestic market, nowadays the timing not only just the distance have been shortened because of the transportation route but also the speed have been increased, so that the transportation timing is increasing.
So the compression effect on the space as well as on the time enable Henan to be the of the domestic, you know, circulation, as well as connecting to the rest of the world, so the so -called outside circulation.
Now, the purpose of the dual circulation is to promote, unify the domestic market, not only for the merchant product but also for the production, you know, factors, the intermediate, you know, component, and also labour.
But because the transportation system has been improved, because the efficiency has been improved, that enables Henan to be more and more integrated, not only with the rest of the country, but also become a hub for international trade.
So this is a partly reflect the aggregate development of China itself.
Henan Province is just a reflection of what the rest of China is actually doing.
Professor, one last question.
President Xi also visited the Whitehorse Temple and Longmen Grotos.
We see that many cultural attractions, including those two, have begun to use scientific and technological support.
So, how do digital tools like 3D restoration change how China shares its ancient heritage with the world?
Yes, I mean, this is only the Whitehorse Temple and also the other tourist spot area.
They would only demonstrate the cultural heritage.
Nowadays with the digital economy, with the digital technology, all these cultural heritage could be digitalized and they can see in the computer screen or also in the mobile phone and so on and so forth.
So they enabled tourists not only from China but from the rest of the world, people they can see from the mobile phones or also from the TV, video, and so and so, digitalizing directly, seeing what is the most beautiful spot in China, and Henan province used to be the origin of the Chinese civilisation.
So, certainly, including the White Horse Temple, these are the kinds of areas that need to be shown off to the rest of the world to attract tourists.
Now, why tourism nowadays becomes so popular is purely due to the upgrading of people's living standards.
More and more people are able, including mostly the middle income class, after meeting the and other necessity, they have some spare money to go out.
So where to go out?
And how to find out the best place?
And how to find out the quickest place to visit?
I think the digital technology could certainly help the tourists to identify quickly where they can go and spend the money and the time to have leisure, to see the most beautiful places not only in other part of the country but in particularly in Henryland in this case.
Thank you professor for those valuable insights.
That was Dr. Yaxu Jie, Chong Kong professor of economics at Chongqing University.
Coming up, Beijing criticizes Washington's attempt to ban Chinese chips.
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Now let's shift to a major disruption in the global tech landscape as U .S. attempts to impose a globally ban on advanced Chinese computing chips.
China has issued a sharp rebuke condemning the U .S. action as a blatant act of unilateral bullying and protectionism, warning that it undermines global semiconductor supply chains and the shared interest of global tech innovation.
At the same time, the CEO of U .S. chip giant Nvidia, Chen Seihuan, has again publicly condemned the policy as a failure.
He said, Washington's export restrictions have backfired and cost American businesses billions while failing to halt China's tech progress.
So, to unpack these developments, I am joined by Andy Mark, tech analyst and senior research fellow at the Center for China and Globalization.
Thanks for joining us, Andy.
My pleasure, as always.
Andy let's start by looking at the bigger picture of this escalating tech oppression from the United States against China.
From your perspective what's driving the United States increasingly aggressive chip policy towards China?
Is this more about national security or economic supremacy?
Well I think the way the US sees it is national security and economic security security, are related.
And from a more traditional national security perspective the U .S. relies not on its enormous army it does not have, numerically, the largest armed forces in the world.
So what it has to rely on is advanced technology.
So whenever it sees any country closing the gap whether that was Japan or today China, it feels threatened.
So it feels it must retaliate or somehow try to slow down or stop the rise of a potential peer competitor is one of the terms that has been used.
I think from an economic perspective as well as we all know Technology leaders often are able to charge premium prices as well.
So, this is also important.
But I think the challenge here is that just if we look at these macroeconomic drivers, China with a much larger population, 1 .4 billion people, but here's where the people really matter.
The number of scientists, STEM graduates, science, technology, engineering, and mathematics graduates are multiple.
China graduates multiple of these students a year that the United States does.
So I think it's very very difficult to stop or even slow down China.
So in this sense, I think the US is fighting a losing battle as it's becoming increasingly clear.
Andy, the US now is attempting to enforce a global ban on the use of advanced to Chinese computing chips.
How feasible is such attempt in practice?
And why does China argue that this move could deprive other countries of their legitimate right to develop advanced computing and AI industries?
Well, that's absolutely right.
So I think that, first of all, this is a last -ditch desperate attempt by the U .S. That I think I think probably most US policy makers know, but might not be able to publicly acknowledge that it is destined to failure, but it feels it has no other choice.
At the same time, it is inflicting enormous collateral damage, and in particular, to other countries around the world, because I think that is, China has it exactly right, that that respect for sovereignty, respect for other countries' development choices, including choice of technology platform, is a vital element of sovereignty.
And I think the U .S. by doing this, is in fact violating the sovereignty of many countries around the world by exactly, as you said, depriving them of technological choices that not only are very cost effective, but increasingly the technological leader globally.
So this is absolutely not only self -destructive, I think, from the perspective of the United States when we look at the impact it is having on American technology companies like NVIDIA, as you touched upon, but it is also I think hurting the development prospects of many countries around the world.
And this is I think generating or eroding the goodwill that many of these countries had towards the United States.
And this is why we see leading American investors striking the alarm bell here by saying that the American brand is suffering enormous global damage that may be difficult, if not impossible to recover from.
Speaking of the damages, beyond official responses, such policies are now being openly criticized by key players in the US tech industry's self.
Justin Huang, the CEO of NVIDIA, a company that once had 95 % of the Chinese AI chip market, recently said, the US export controls are completely wrong and have actually undermined America's leadership in the AI sector.
So how significant is this, that someone like Jensen Huang is publicly defining the Washington's stance?
I think it's very significant that Jensen Huang has come out with these statements.
We know that corporate leaders in the US generally tend to be cautious in their public statements.
And the fact that he would say something like this, I think, again, shows the damage that these policies are doing.
Because when we look at companies like Nvidia, like Qualcomm, a lot of these companies in the high tech space, they spend an enormous percentage of their revenues on research and development to invest in the next generation of technology.
So any loss of market share, loss of revenue could erode their leadership position globally.
So I think that that is an existential concern.
And then when we look at, as he pointed out in particular regarding China that many Chinese enterprises would prefer to buy Nvidia.
But, this creates the space and the incentive for Chinese competitors to accelerate their developments.
So again, yes, I think, you know, that Jensen Huang is absolutely correct in pointing this out.
And, you know, we may see again the long -term negative repercussions of these actions that the U .S. is taking, and that again, as I touched on, are not only self -destructive, but imposing enormous collateral damage on countries around the world as well as on American corporations.
One last question. He also mentioned that Washington's containment strategy is actually accelerating China's self -reliance and innovation in the semiconductor sector.
How do you assess China's recent progress in chip development, and at this stage, how much impact are the tightened US restrictions really having on China's semiconductor industry?
Well I think the Chinese stance on this which has been unfolding, or we've seen this for eight years now, is that hope for the best, be prepared for the worst. Because this did not just start, but at the beginning of the first Trump administration that I think China recognized that it needed to be prepared for this eventuality, but still leaving the door open to say, we want to work with the United States, again, on the basis of mutual respect, respect for sovereignty, respect for each country's development choices, but at the same time, being prepared for exactly these kinds of actions.
So I think that this really has been, on the one hand, challenging set of circumstances for China, but one it has prepared for as well.
And I think, again, is only accelerating the advances of the semiconductor sector in China.
And I believe over the next few years, we may see some very, very dramatic changes that came about precisely because of these, perhaps we could say, not so wise policies on the part of the United States.
And I wouldn't be surprised if we see more tech leaders in the United States also taking positions similar to that of Jensen Huang.
Thanks to Andy for your insightful analysis.
That was Andy Mok, a tech analyst and a senior research fellow at the Center for China and Globalization.
You are listening to Road Today.
Stay with us for more in -depth analysis after the break.
This is Road Today with Mika Anna in Beijing.
Let's move to Japan.
As chief trade negotiator with United States, Ryosei Okazawa has reiterated that the country is firm in its demand for the removal of US tariffs during bilateral trade negotiations.
He emphasized that Japan will not rush into any agreement that might compromise its national interests.
At a recent press conference, Akazawa described U .S. tariffs on automobiles, car parts, steel, and aluminum as regrettable.
The chief trade negotiator is scheduled to travel to Washington this week and expected to hold the third round of negotiations with U .S. trade representatives.
To unpack Japan's position and what Lisa had in these trade talks, let's turn now to our guest, Professor Chu Chang, fellow of Belt and Road Research Center at Minzu University of China.
Thanks for joining us, Professor.
Thank you. Professor, many analytical pieces have pointed out that Japan's attitude towards the United States has shifted compared to before, with the ishiba administration showing a noticeably tougher stance.
So, how do you view this assessment?
What changes have occurred in Japan's approach and position regarding trade talks with the United States?
I think the Ishiba government actually has this consideration over many factors.
For example, domestic politics, economy, international respondings.
Number one, what we know from our source in Japan is that the Japanese political society actually very strongly oppose this kind of the deal, because it's been not only hurting the political dignity, but also hurting strongly of their economic integrity.
So, this is going to be, you know, triggering a lot of the adjusts, you know, confident and also, you know, affecting the government supporting ratios.
And already, we have already seen the tariff, existing tariff policies, has been impacting Japanese economy.
For example, right now, many major car makers probably are losing more than 19 billion US dollars due to the tariff policies.
So I think if Ishiba government do not respond very tough and I don't think a domestic society, especially the business society is going to like that.
And also, I think you know international factors, that Japan has viewing how China is responding to this crisis.
Well China is acting very tough, but the result is simply OK.
But U .K., well they nailed down towards this requirement from the United States.
But the United States didn't give favor to U .K., who are their old alliances, but instead they've been imposing extra strings onto U .K. So Japan is weighing the pros and cons.
They've been saying, okay, if I'm playing soft, and U .S .A.
wouldn't give me a softball back, but if I'm playing hardball, maybe the situation is not going to be that bad eventually.
So I think that's the reason why they get this consideration at last. Professor, the two sides remain significantly divided on issues such as automobiles, steel and aluminum tariffs, and so -called reciprocal tariffs.
Japan has proposed a package involving increased agricultural imports and technological cooperation in exchange for tariff exemption.
From the U .S. perspective, these offer viable.
And why does Washington seem to lack the motivation to make concessions with Japan?
Well, I think Japanese people are really smart.
They've been so smart.
Even I can smell the smartness from China.
Well, in Japan they've been having this problem, what we call a Komeirashi.
That means a shortage of the major rice supply in Japanese market.
Look, if you're going to a supermarket in Japan, you're going to see the price of the ordinary rice, which is a staple food for Japanese people are rising about 50 times to 100 times.
Some people are even trying to smuggle rice from the air plan from China into Japan.
So consider how terrible the situation it is.
So I think is Shiba actually want to import more of the rice from America, so -called to to balance its trade with between Japan and America.
But basically they solve their own problem.
So on one hand, they can bring down the price of the rice in the Japanese market, but also try to satisfy the United States.
But I don't think this is going to work because if they are going to use just a rice imported to offset the trade deficit every year, Japan, we're going to need to import more than 64 four million tons of the United States rises.
This is basically 190 times more than what is needed in Japan.
So everybody is going to need more than 200 times of the rise a year so that they can balance the trade with the United States.
And secondly, they're in their package, they're talking about the maybe they can cooperate with each other with technology, for example, like the automobiles so that because they're yielding on the technology secret, so that Washington probably will cut some slack on Japan.
But I don't think they understand that the motive in Washington DC, because the reliance of Japan's economy on the United States is very large, but reversely, the United States economy, they're relying on Japanese technology or market is very, very little.
So I don't think Washington DC will have any motive to cut some slack on Japan or to bargain with them, Because I don't think the Ace card or the Ghost card, the Joker card is in Japan's hand so I don't think this is going to go anywhere.
Professor, speaking of the rice imports, reports say such imports have become a key issue influencing the ruling liberal democratic party's electoral prospects.
The party's officials have noted that even if Japan agrees to increase U .S. corn and soybean imports, they cannot make concessions on rice.
Why has rice become a non -negotiable issue to Japan?
Well, Japan, they're doing what we call the boutique store agriculture.
So in Japanese agriculture industry, it's not a farm, it's not the farmers even controlling the home market, but the Agriculture Institution or Agriculture Association in Japan, we call it a Nokyo.
So this Nokyo is more like an organization, more like a worker's union in the farming industry and controlling and monopolizing all kinds of resources.
And they have a strong power to bargain with Japanese government.
So every year, they can get a huge subsidy from Japanese government.
That's a reason why you see the you see these kind of the Japanese beef and also the Japanese rice are getting so expensive, become the luxury brand and the whole world market is because of this is a very high subsidies.
And now you're talking about importing, you know, 200 times of rice is from United States market to flood you know Japanese rice market and there's no cure this agriculture association.
Basically they're going to lose lots and lots of money and all this kind of the luxury brand rice will fall from this public store and go to the supermarket and or even go to the Costco.
So I don't think those lords those troubles would like to see that happening.
That's the reason why they're going to see a lot of protest from the Tokyo and also from Japanese farmers against the government if they take the deal with America on rise.
Professor, historically in the 1980s and 1990s, the U .S. imposed protectionist measures on Japanese automobiles over trade deficit concerns and perceived economic threat.
So do you think the U .S. and Japan are heading down a similar path today?
So if Japan makes compromises, What active consequences or setbacks could they face?
Well, indeed. I think we still remembered how American automobile industries and workers and also the politicians are smashing down Japanese cars, like Toyota and Honda.
I think they still got the tragic memories when the workers in the United States tried to smash the car, Japanese car, on the street of America and boycotting all kinds of Japanese product.
This is the history.
But I don't think this time, Japan would like to make it happen.
happen again. Because Japanese auto industry is not that lucrative like before.
They're not number one anymore if they're yielding to America to a large extent.
I think the whole value chain for Japanese auto industry is going to be bleeding out even quicker.
Already they've been beating down the whole thing by German cars, Chinese cars, and even beating down by American cars like Tesla so I think Honda Toyota they're facing a rather you know difficult moment right now and what the Chabot groups and also politician groups of their representative are gonna really really protest against if the government are doing the things to in agree with America to you know on some deals against Japanese auto industry and also like what just I mentioned these kind of the mood if it happened this kind of was spill over to agriculture industry to service industry to high
tech industry. So all the Japanese business society, which they have a lot of lots of lobbyists power against the Japanese government, we don't like it.
So this kind of dissatisfaction will probably impact the whole Japanese political society.
I don't think Ishiba government would like to see that happen.
Thanks, Professor. Many thanks for your in -depth perspective.
That was Professor Chu Chao, Fellow of Belt and Road Research Center at Minzu University of China.
Coming up, study shows US tariffs dampen mood of global exporters.
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Welcome back to road today, let's continue our discussion on how U .S. tariffs policy is disrupting international trade and shaking business confidence around the road.
According to a recent survey conducted by German financial services provider Allianz, positive export expectations have been halved just 40 % since the US announced its latest round of tariffs last month.
The Allianz Global Trade survey also estimates the global export loss could surpass US $300 billion this year.
The survey covers 4 ,500 companies across nine major economies, including the United States, China, France, Germany, and Singapore, representing 60 % of global GDP.
So for more on this, my colleague, Shihua Wen, is joining us in the studio.
Thanks for joining us, Shihua Wen!
It's a pleasure! First, the survey shows a pretty big change in how businesses are feeling about growth and risks since the U .S. announced those tariffs a few weeks ago, especially when it comes to payment delays.
How do you think these tariffs have affected businesses and their confidence, both around the world and in the U .S.?
Thanks for the question, Anna.
So as you said, the Alliance Trade Service provides very timely insight into how businesses are reacting to the latest rounds of U .S. tariffs, and we can see the numbers are just quite striking.
So, before the tariffs were announced on April 2nd, fewer than 5 % of exporting firms expected a decline in turnover.
But after April 2nd, what many companies are now referring to as tariff day, that number jumped to 42%, so that means nearly half of all exporting companies now anticipate a drop in turnover over the next 12 months, and this is a quite dramatic and sudden shift in business expectations.
So I think the core issue here is the unpredictability of the U .S. trade policy.
It's just as damaging as the tariffs themselves.
We can see even though, you know, the U .S. president has pulled back many of the tariffs he initially proposed, such as key tariffs, like those additional reciprocal tariffs.
However, we know that key tariffs remain in place, including the 10 % universal tariff on all U .S. imports, also the 30 % tariff on Chinese imports and some extra tariffs on specific industries like metal and auto parts.
So businesses can still, I mean, they can hardly play around with such a higher costs if those costs are not stable.
And then when policy changes suddenly at such a large scale, it shakes investor confidence.
As we also mentioned, delays shipments and also make it harder for companies to honor payment terms. So for global exporters, including many in China, this instability introduces serious risks and it becomes harder to manage cash flow or plan production when your biggest customer, the U .S., can change their rules overnight.
So, within America, I think companies are also feeling the pain.
So more than half of the American firms surveyed said that they expect to raise prices to pass a long -term cost, which means they don't feel confident in absorbing those shocks internally.
And that's a clear sign that business confidence is weakening across the board. I think that's why the report also points out a sharp drop in companies expecting their exports to grow this year.
Do you think this is just a temporary thing or could it signal something you know bigger and long -term shifts in global trade?
Well I think what we're seeing here is not a temporary reaction it's gonna be a sign of long term structural shift in global trade patterns.
So as the Allianz report shows a steep drop in companies expecting export growth.
We have noticed that at the beginning of the year, about 80 % of businesses were confident in growing their exports but after the April tariffs, less than half still hold that view.
And this collapse in optimism suggest that companies are reevaluating their long -standing trade relationships.
And we're seeing signs of what economists today are calling front -shoring, where companies shift the supply chain toward countries with more predictable trade or political alignment.
For instance, even though we know there is the new trade agreement with China and the US recently have brought the average US tariff on Chinese goods down to around 39%, that's a big job from the massive over 100 % before is still way higher than the 13 % rate before the pre -trade war levels.
And many firms see the relief as a temporary measure and they're preparing for a long term adjustment rather than a return to business as usual.
And now if we look at the French shoring it's going to keep gaining momentum in the meantime so Chinese companies they're starting to look more seriously at European market, the Latin American market as better, more stable options.
In the meantime survey also finds that European companies they're showing more interest in selling to Chinese market and other parts in Asia.
So the survey also mentioned that export plans to the region rose to 36 % and interest in markets in South and Southeast Asia actually doubled to 14%.
So in a nutshell, these changes are not just reactive, they reflect a deeper transformation in how companies think about supply chain resilience and also political risk, also the regional trade hubs.
So this could be the beginning of a new era in global trade where the US isolates itself from the free trade world and other countries across the globe diversify their trade with partners who are willing to engage and cooperate.
Building on that when we see big US companies like Walmart are saying they will raise prices and move some production outside the United States, do you think we are seeing more multinationals rethinking you know how much they can rely on U .S. market, even those U .S. companies.
And how might this change investment plans in places like China or Southeast Asia?
Yes, we're definitely seeing that trends like, as you mentioned, multinational firms, they're reassessing the costs and risks of over -reliance on the American market and supply chains rooted in U .S. trade policy.
When major companies like Walmart and metals say they are raising prices and moving production outside the US, this is not just a business decision.
This is a signal to the markets and telling us that American multinational companies no longer see the US as a fully reliable anchor for global production and trade.
As the US tariffs make operations more expensive and less predictable, I think American companies, they're increasingly looking forward like to find markets such as Asia, not only for manufacturing, but also for market growth and long -term stability.
And under this context, I think both China and some Southeast Asia countries are becoming more attractive destinations.
And while some, maybe we know China still remains this critical player due to its very advanced industrial base, infrastructure, and deep supplier networks, Despite some geopolitical tensions, I think many global companies still view China as this irreplaceable for advanced manufacturing and as the consumer market too large to ignore.
One last question. Briefly, we are hearing that some of America's busiest ports like Los Angeles and Long Beach are seeing shipments drop by almost half, and they are worrying about job losses and inventory problems. What's your take on how these tariffs are impacting US logistics and jobs overall?
Yeah the situation at the US ports is very alarming, like you mentioned these two ports are very important ports in America, Los Angeles and Long Beach. Like the shipment traffic at the ports is down nearly 50 percent and there are the two business the container container terminals and they're vital not just for goods from China but also for the entire US retail and manufacturing sectors.
I think the impact goes beyond shaping delays.
Some port officials are warning about serious job losses.
We're not only talking about jobs for dock workers but also for truck drivers, warehouse staff and more.
Their experts suggest that every four containers means a job, so when half of that volume disappears, that's about thousands of jobs at risk.
I think this is not just a logistic issue, it's a policy failure.
The tariffs are disrupting the flow of goods and creating ripple effects across the US economy and unless there is the negotiated situation soon, we will likely to see rising prices, fewer production, fewer product choices and growing unemployment in the sectors related to trade.
Great insights. Thanks Yaoyuan for sharing.
That was my colleague Xu Yaoyuan.
CATL, a Chinese battery manufacturer has witnessed the world's biggest IPO listing this year.
It raised $4 .6 billion on its first day enough trading in Hong Kong.
Shares in the company, which makes more than one -third of all electric vehicle batteries worldwide, closed 16 percent up on the debut day, despite the threat of U .S. sanctions.
The CATL floatation lifted Hong Kong back to the number -one spot in global fundraising.
It means its IPO market this year is already worth of US $7 .5 billion.
That's a six -fold increase on last year.
Hong Kong is ahead of both the NASDAQ and New York Stock Exchange for IPOs so far this year.
So for more on this, my colleague Zhao Yang spoke with Chen Jiahe, Chief Investment Officer at Novanark Technologies.
So Jiahe shares in CATL jumped about 16 % on its first day of trading in Hong Kong and this was the largest IPO so far this year.
So what's your take on CATL's debut in Hong Kong?
Are you surprised by its jump in share price?
Yeah, it's actually a bit of a surprise, because Hong Kong is a very competitive market, you know.
Usually companies when making the IPO, they get a flat open, either go up a bit or down a bit.
But this time, we see that the ATL has been rising quite a lot.
It really tells you how enthusiastic the Hong Kong market is about this new share, and this shows that Hong Kong market is again coming back to a bull market.
In fact, many Hong Kong stocks have been rising in the past few years, basically because many capitals are sinking China as a very good destination, especially amid the tariff war started by the Trump administration against so many countries in the world.
I mean, people are no longer that confident about the capital market in the United States when you look at so volatile the tariff has been over there.
So many capital are really coming to China, and Hong Kong is one of the most important markets of China, I mean alongside the markets in Shanghai, Shenzhen, Beijing.
And why did CATL choose a secondary listing in Hong Kong instead of another global financial center like New York or London?
And how important is Hong Kong as a financial platform, in particular for Chinese companies especially given the trade tensions and tariff tensions started by the United States?
Yeah, that's a very good question regarding why they choose Hong Kong.
I mean, it's, I think it's pretty obvious to say that they choose Hong Kong over New York or Nasdaq basically because this trade tension between China and the U .S. will stop any Chinese company from having the confidence to get themselves listed in the United States, because you might just get discriminated actions.
There has been so many rumors and facts about Chinese companies get discriminated treatment in the United States.
So any company's thinking that, OK, I'm going to get listed, I'm not going to just get away with an IPO and I get the money away from the IPO and that's about it.
I want to do business for 10 years, 20 years.
They won't choose the United States because they were worried.
So that's why they choose New York, well, Hong Kong over New York.
The reason they choose Hong Kong over London, I think is basically because, you know, London is not an active market like Hong Kong is.
I mean, Hong Kong is a very active market.
If you look at how many capital actually going into Hong Kong, if you look at how many investors are coming in here, but if you look at London, London is more like a matured market.
You have very matured market performance.
You have less capital compared with Hong Kong.
So that's probably why they choose Hong Kong now.
Also because they are a Chinese company and Hong and the global markets it really offers you know it really offers Chinese companies with a very good chance to connecting with the global capital and a very solid political background.
You're not worrying about you know basically anything.
Anything relating with political issues would happen to you if you get listed in Hong Kong.
So it's a very good platform for Chinese companies over here.
Despite Washington's trade policy there is still a big confidence among international investors for leading Chinese manufacturers, right?
So how do you explain that?
Well it's very interesting, because if you look at the stock price of the ATL, it actually performed much better in Hong Kong, so that means global investors, because Hong Kong actually got more global investors.
So this actually means more global investors are interested about the ATL.
So that's why we can say that the global capital are really interesting about China's high -tech components.
Because if you look at the global markets, China is one of the most important fields for investing.
You have probably a few large markets.
I mean Europe, Japan, China, United States, Southeast Asia, and that's about it.
You don't have that much choice on this world.
And China is one of the largest markets, probably the largest market, especially if you look at the purchasing power parity of the GDP.
We are the largest economy and we are growing at a very solid speed compared with many other economies.
And we've got very stable political environment.
The policies Chinese government made about 10 or 20 years ago is inconsistent with what we are making today.
And you can expect that for the next 10 or 20 years, you will be able to see the same kind of policies.
So that's why so many global capital are really interesting about China.
You can't miss this if you are doing global investment.
And the company said part of the funds raised this time will go towards this international business expansion.
So how significant is that for CATL?
And how insulated is CATL from the U .S. trade policies?
I mean, is it fair to say that its ambitions will be focused much more on Europe and obviously we've seen CATL has a factory being built already in Germany and Hungary and there is a potential of joint venture in Spain right?
Yeah definitely, the global business is very important for CATL especially and actually for any Chinese manufacturer who is trying to grab a bigger business share in the world We can't miss the global markets.
I mean, we definitely can't focus on the United States because the tariff has been changing so rapidly and the trade tension between China and the US has been going on in the past few years.
So you don't know what kind of business environment you will be facing if you are a Chinese company in the United States.
So many Chinese companies are trying to avoid United States But United States is only a small part of the world.
I mean, they are taking, I think it's about one fifth of the global GDP, but they have a slower growth rate compared with many economists around the world.
And Europe and Southeast Asia also very large markets for China.
So Chinese companies are choosing to expand to these markets as well.
And these markets, many of them are really welcoming the Chinese businesses because we offer products at very good price, with very good quality.
So, globalization of Chinese companies will not be stopped.
It will expand outside of the United States, and this actually will bring more economic benefits to the countries and economies that accept the Chinese companies.
I read a report this morning about a pause in the United States, it's that if the tariff is keep on added to a higher level, then they will face a bit of disadvantage compared with many other ports around the world, because it can't buy the good Chinese products.
So this actually brings economic benefits to the economies that accept Chinese company products as well.
And as the largest IPO so far this year, what does this listing mean for Hong Kong's financial market and its role as a global financial hub?
Well, the Hong Kong financial market has been performing really good in recent two or three years.
And this IPO just brings more energy into the markets because Hong Kong market currently is absorbing a lot of capital around the world because for global investors, Hong Kong market would be the first step for them to enter into the large Chinese markets.
If you look at the listed companies over there, Hong Kong market has got all the documents written in English.
So that means for many global investors, the first market that they would choose is Hong Kong.
Actually personally, my company has got about 85 % of our investment in Hong Kong market as well because got almost all the large companies in China listing there, and they are trading at very good, very good valuation.
So we've got about 80 or 90%.
I think it's about 85 % of our money in Hong Kong as well.
So it's a pretty good market.
It's been rising really sharp in recent years.
and you can throw in billions of money in within just one day and you can get the money out the next day they got no limits on capital they got everything written in English they've got all the Chinese large companies listing there so it's really good market and this IPO is just helping the market by a further step.
That was Chen Jiahuo, Chief Investment Officer at Novanark Technologies that's all the time for this edition of railroad today I'm Guiana in Beijing Thank you so much for listening.
Bye for now.
