Chinese President Xi Jinping made a significant pitch to global business leaders on March 28, 2025, in Beijing, as he sought to position China as a reliable partner amid escalating trade tensions with the United States. The meeting, held at the Great Hall of the People, included over 40 executives from various industries, including prominent figures from the pharmaceutical sector and automotive giants.
In his address, Xi made a veiled critique of U.S. President Donald Trump’s recent trade actions, which have involved imposing heavy tariffs on imports from China. As Trump prepares to implement a new round of tariffs on April 2, Xi emphasized the importance of stability in China-U.S. relations, stating, "maintaining the stability, health and sustainable development of China-U.S. relations is in the fundamental interests of the people of both countries," as reported by Bloomberg.
The meeting featured key executives such as Stephen A. Schwarzman from Blackstone, Judy Marks of Otis Worldwide, and Jay Y. Lee of Samsung Electronics. Notably, the pharmaceuticals sector had a strong presence, with CEOs from AstraZeneca, Bayer, Boehringer Ingelheim, Eli Lilly, GSK, Merck KGaA, Pfizer, and Sanofi attending the gathering, marking the largest representation from a single industry at the event.
Among the notable speakers was Sanofi CEO Paul Hudson, who highlighted the company’s recent investment of approximately 1 billion euros ($1.08 billion) to establish a new production base in Beijing. This investment reflects a growing trend among foreign companies to expand their operations in China despite the ongoing geopolitical tensions.
Xi's meeting with these corporate leaders comes at a critical time, as foreign investment in China has seen a decline. According to China's Ministry of Commerce, foreign investment dropped to $116 billion in 2024, down from $163 billion in 2023 and a peak of $189 billion in 2022. This decrease is attributed to various factors, including tightening national security laws and increasing wariness among global companies about making large investments in China.
During the meeting, Xi urged the executives to maintain the stability of global supply chains, asserting that China holds significant potential for investors. He remarked, "I often say that blowing out other people's lights does not make you brighter," emphasizing the need for cooperative growth rather than competitive destruction.
As the trade war intensifies, companies within the pharmaceutical sector have found themselves in a precarious position. Trump’s administration has targeted pharmaceuticals for potential tariffs, prompting companies like Eli Lilly to announce substantial investments in domestic manufacturing. Earlier in February, Lilly declared a $27 billion investment to expand its production capabilities in the U.S., while also signaling intentions to increase investment in China.
Meanwhile, AstraZeneca recently unveiled a $2.5 billion investment in China, which includes plans for a global strategic R&D center in Beijing. This investment comes alongside a commitment of $3.5 billion to enhance its manufacturing and R&D capabilities in the U.S., showcasing a balancing act that many pharmaceutical companies are attempting to navigate between the two largest markets.
The meeting also highlighted the automotive sector's ongoing interest in China, with executives from companies like BMW and Toyota present. BMW recently increased its stake in a Chinese joint venture, indicating a strong commitment to the Chinese market. The company has also announced plans to collaborate with Alibaba on artificial intelligence technology for its vehicles.
Despite the challenges posed by the trade war, the German automotive industry has been particularly active, representing a significant portion of new investments from the European Union. Reports suggest that German automakers have accounted for as much as half of the new investments, with companies like Volkswagen establishing new manufacturing facilities in China.
However, the broader sentiment among foreign businesses remains cautious. Surveys conducted by foreign chambers of commerce indicate that deteriorating market conditions and overcapacity in several industries are contributing to a lack of confidence in potential profitability from new investments in China.
As Xi continues to court foreign investment, the ongoing trade tensions and the U.S. administration's aggressive tariff policies loom large over discussions. The recent meetings between pharmaceutical executives and Trump, where the President suggested that companies should relocate manufacturing back to the U.S., underscore the pressures these industries face.
With both sides navigating a complex web of economic and political challenges, the future of U.S.-China trade relations remains uncertain. As Xi Jinping pitches China as a protector of trade and a stable investment destination, the response from global business leaders will be crucial in determining the trajectory of foreign investment in the coming years.
The meeting on March 28 serves as a reminder of the delicate balance that multinational companies must strike as they operate in an increasingly polarized global environment. With the stakes high and the landscape constantly shifting, the paths forward for these corporations will require careful consideration and strategic planning.
