Trump’s picks prompt hope of prag­ma­tism on trade, cur­rency

Team of cor­po­rate ex­ec­u­tives might bring pru­dence to pol­i­cy­mak­ing, ex­perts say 53, a pri­vate eq­uity in­vestor, hedge fund man­ager and Hol­ly­wood fi­nancier who spent 17 years at Gold­man Sachs be­fore leav­ing in 2002

China Daily (Hong Kong) - - TOP NEWS - By ZHANG YUNBI zhangyunbi@chi­nadaily.com.cn CHINA DAILY-REUTERS

As cur­rent and for­mer cor­po­rate ex­ec­u­tives dom­i­nate the econ­omy-re­lated posts of US pres­i­dent-elect Don­ald Trump’s in­com­ing ad­min­is­tra­tion, ob­servers voiced hopes that Trump’s picks will ex­er­cise prag­ma­tism and pro­fes­sion­al­ism to help avoid a trade or cur­rency war be­tween the world’s two largest economies.

Al­though mi­nor eco­nomic fric­tion or bar­gain­ing will be in­evitable, the new Cabi­net should make it a pri­or­ity to ad­dress the anx­i­ety in busi­ness

Some of Trump’s se­lec­tions for top jobs in his ad­min­is­tra­tion

SEC­RE­TARY OF STATE Rex Tiller­son, 64, chair­man and CEO of Exxon Mo­bil Corp cir­cles in the United States and China prompted by Trump’s con­tro­ver­sial re­marks, ex­perts said. China is the US’ largest trade part­ner.

Trump’s key Cabi­net picks as of Wed­nes­day in­clude Rex Tiller­son, chair­man and CEO of Exxon Mo­bil Corp, for sec­re­tary of state and Steven Mnuchin, who spent 17 years at Gold­man Sachs, as Trea­sury sec­re­tary.

Wang Jian­lin, CEO of China’s prop­erty-to-en­ter­tain­ment con­glom­er­ate Wanda Group, warned at a fo­rum over the week­end: “I have over $10 bil­lion in in­vest­ments in COM­MERCE SEC­RE­TARY Wil­bur Ross, 79, heads the pri­vate eq­uity firm W.L. Ross & Co. His net worth was pegged by Forbes at about $2.9 bil­lion. the United States and em­ploy over 20,000 peo­ple. If things are mis­han­dled, they will have noth­ing to eat.”

David Shogren, pres­i­dent of US In­ter­na­tional Foods, a com­pany ex­port­ing many prod­ucts to China, told Agence FrancePresse on Tues­day, “My fear is what­ever changes Trump makes ... that China will re­tal­i­ate in some ways.”

Pang Zhongy­ing, a pro­fes­sor of in­ter­na­tional re­la­tions at Ren­min Univer­sity of China, said the cor­po­rate lead­ers in Trump’s ad­min­is­tra­tion, know­ing clearly the benefits of glob­al­iza­tion and hav­ing ben­e­fited from it, will in­tro­duce self-ad­just­ment if Trump in­tends to change eco­nomic poli­cies.

Al­though many see Trump’s LA­BOR SEC­RE­TARY An­drew Puzder, 66, chief ex­ec­u­tive of­fi­cer of CKE Restau­rants Inc, which runs the Carl’s Jr. and Hardee’s fast-food chains elec­tion vic­tory as a sign of the “re­treat of glob­al­iza­tion”, any flow­ing back of pro­duc­tion work to the US will face the re­al­ity of higher la­bor costs, and the jobs will then flow back out again, Pang pre­dicted.

Wu Xinbo, di­rec­tor of the Cen­ter for Amer­i­can Stud­ies at Fu­dan Univer­sity in Shang­hai, said the for­mer ex­ec­u­tives among Trump’s Cabi­net choices will “in­ject pru­dence and prag­ma­tism into pol­i­cy­mak­ing pro­ce­dures”.

“They know well that it would not do any good if the re­la­tion­ship with China runs into a stand­off,” Wu said.

Wu pre­dicted that Trump’s ad­min­is­tra­tion “will avoid a di­rect trade war against China by us­ing tax poli­cies as a lever­age to en­cour­age US busi­ness- NA­TIONAL ECO­NOMIC COUN­CIL DI­REC­TOR Gary Cohn, 56, pres­i­dent and chief op­er­at­ing of­fi­cer of in­vest­ment bank Gold­man Sachs. es to shift their pro­duc­tion lines back to the home­land”.

The Trump ad­min­is­tra­tion, seek­ing greater ex­ports to China, might lift re­stric­tions on ex­ports of oil and gas, while putting pres­sure on China’s ex­ports to the US by in­tro­duc­ing more anti-dump­ing probes or anti-sub­sidy mea­sures, Wu said.

Chen Fengy­ing, a re­searcher on the world econ­omy at the China In­sti­tute of Con­tem­po­rary In­ter­na­tional Re­la­tions, said Trump prob­a­bly “will not be as ca­sual as he is now” af­ter tak­ing of­fice on Jan­uary 20, since he could be limited by Con­gress and his ad­vis­ers.

Comment in new loans was is­sued by Chi­nese banks in Novem­ber.

Inside

Medium- to long-term hous­ing loans is­sued to in­di­vid­u­als to­taled 569.2 bil­lion yuan in Novem­ber, up from 489.1 bil­lion the pre­vi­ous month, while lend­ing to non­fi­nan­cial sec­tors was 201.8 bil­lion yuan, up from 72.8 bil­lion in Oc­to­ber.

“Ris­ing de­mand for cor­po­rate lend­ing pro­vided some good news for sta­bi­liz­ing the econ­omy,” said Liu, adding that the data is in line with ear­lier in­di­ca­tors re­leased by the Na­tional Bureau of Sta­tis­tics.

Re­tail sales growth picked up to 10.8 per­cent year-on-year in Novem­ber, which is the high­est level since De­cem­ber last year, ac­cord­ing to data re­leased by the Na­tional Bureau of Sta­tis­tics on Tues­day.

Com­ment­ing on the mort­gage lend­ing that went up month-on-month, Liang Hong, chief econ­o­mist of China In­ter­na­tional Cap­i­tal Corp, at­trib­uted strong de­mand for mort­gages to the de­layed ef­fect of poli­cies.

More than 20 first- and sec­ond-tier cities is­sued tight­ened poli­cies to cool down the over­heated hous­ing mar­ket start­ing in Oc­to­ber.

Data re­leased by the NBS on Tues­day show that growth in home sales slowed to the slow­est pace this year in Novem­ber, and new con­struc­tion starts rose by just 3.3 per­cent year-on-year in Novem­ber, much lower than the pre­vi­ous month.

Liu ex­pected that the pro­por­tion of mort­gages will de­cline in the com­ing months.

Mean­while, cen­tral bank data showed that M2, a broad mea­sure of the money sup­ply that cov­ers cash in cir­cu­la­tion and all de­posits, grew by 11.4 per­cent year-on-year in Novem­ber, while M1, a nar­rower mea­sure of the money sup­ply, rose 22.7 per­cent year-onyear.

“The un­der­ly­ing mes­sage by the cen­tral bank is that it will main­tain a rel­a­tively loose en­vi­ron­ment for fi­nanc­ing,” said Liang.

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