President Xi seeks to allay concerns China’s economy is turning inward

Chinese President Xi Jinping tried to reassure international businesses the nation is committed to open trade, amid concerns that the new “dual circulation” strategy will mean the world’s second-largest economy is set to become more insular.

China’s new development structure is “definitely not a closed domestic circulation, but a more open dual circulation between overseas and domestic markets,” Xi said at the opening of the China International Import Expo on Wednesday in Shanghai. The strategy won’t only address China’s own demand for growth, “but will also bring benefits to all countries around the world.”

Xi speech was closely watched, given the backdrop of the U.S. election result and the stunning withdrawal of what would’ve been the world’s biggest stock-market debut, the listing of financial technology giant Ant Group Co. in Shanghai and Hong Kong.

He didn’t mention either of those events, sticking instead to broad commitments to economic opening at a time when Beijing’s growth model faces increasing challenges from the U.S. The trade expo comes less than a week after the ruling Communist Party laid out development blueprints stretching until 2035 that stressed the importance of self-reliance in technology and boosting the domestic market.

Xi’s speech on Wednesday evening in Asia took place hours after polls closed in the U.S. With relations with Washington continuing to worsen this year due to the pandemic and other factors, Xi delivered a veiled swipe at the U.S.

“COVID-19 is a stark reminder that all countries are in a community with a shared future. No one can stay immune in a major crisis,” he said. “We need to join hands rather than throw punches at each other. And we need to consult rather than slander each other, bearing in mind the common interest that binds us all.”

Xi has previously used the trade expo to reiterate China’s commitment to economic openness and the global trading order. During the first event in 2018, Xi announced a plan to set up a Nasdaq-style stock board in Shanghai, in an apparent bid to encourage internal innovation and reduce reliance on U.S. technology. The Star board has since emerged as the main listing venue for China’s leading tech companies, with Ant scheduled to make its debut there this week before the IPO was pulled.

Xi said that China would import more than $22 trillion in goods over the next decade. While that may be welcome news to the exporters from across the world who were at the expo, it doesn’t represent a big increase in actual trade flows. China imported about $2.1 trillion worth of goods in both 2018 and 2019, and the pandemic means that inbound trade has actually fallen this year.

MARK SCHIEFELBEIN/AP Chinese President Xi Jinping delivers his address Wednesday. China’s new development structure is “definitely not a closed domestic circulation, but a more open dual circulation between overseas and domestic markets,” Xi said.