Team of corporate executives might bring prudence to policymaking, experts say
As current and former corporate executives dominate the economy-related posts of U.S. 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 circles in the United States and China prompted by Trump's controversial remarks, experts said. China is the U.S.' 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 the United States and employ over 20,000 people. If things are mishandled, they will have nothing to eat."
David Shogren, president of U.S. International Foods, a company exporting many products to China, told Agence France-Presse 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 election victory as a sign of the "retreat of globalization", any flowing back of production work to the U.S. 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 U.S. businesses 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 U.S. 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.
