Editor's Note: These interviews with CEOs of major foreign firms gauge their outlook for the Chinese economy, their operations in China and their business plans for 2024 and beyond, in the wake of the momentous resolution adopted at the third plenary session of the 20th Communist Party of China Central Committee in mid-July.
Q1 The third plenary session of the 20th Communist Party of China Central Committee in mid-July has rolled out the reform and opening-up roadmap for the Chinese economy in the coming years. What are your major takeaways from the plenum? What are the biggest opportunities you spot in China's new measures to deepen reform and further open up its economy? How do you plan to capitalize on these opportunities in your specific industry?
LUSKIN: The plenum's focus on international cooperation is encouraging for multinational corporations like Mobileye. As a leader in Advanced Driver Assistance Systems and autonomous driving technologies, Mobileye is particularly excited about the potential to contribute to the continuous evolution and development of China's automotive industry. The new measures signify a commitment to integrating global best practices and fostering innovation, which aligns perfectly with Mobileye's long-term mission and strategic focus. To capitalize on these opportunities, Mobileye will continue to enhance its deep collaboration with leading Chinese OEMs, China-based foreign joint ventures, tier-1 suppliers and industry partners across the supply chain. This collaboration ensures that Mobileye's safe, scalable, high-performance and cost-efficient solutions eventually benefit millions of Chinese consumers through deployment across a wider variety of car models.
CHEN: The plenum emphasized the crucial role of innovation in economic growth and proposed significant measures to increase investment in areas such as technological innovation and industrial upgrading. In the future, we will continue to optimize our supply chain through technological advancements, material innovation, and other initiatives, aiming to achieve greater success in the Chinese market.
The plenum underscored the importance of further deepening reforms and improving high-level systems and mechanisms for opening-up. China's open and welcoming attitude toward foreign investment will bring more business opportunities to various industries. We will continue to join hands with Chinese partners to explore potential business opportunities, contribute to the vigorous development of China's imports and exports, and achieve win-win outcomes.
XIE: The third plenary session of the 20th Communist Party of China Central Committee is an important window to further understand China's high-quality development and high-standard opening-up. The key message of the plenum is further deepening reform comprehensively to advance Chinese modernization, and it was clearly stated that: "Opening-up is a defining feature of Chinese modernization. We must remain committed to the basic State policy of opening to the outside world and continue to promote reform through opening-up." This is very encouraging for foreign companies like us doing business in China, especially for companies like Vale whose largest market lies in China.
In addition, we also see great opportunities in the reform measures of improving the institutions and mechanisms for modernizing infrastructure and for advancing new urbanization, as these measures will bring new demand for iron and steel, hence bringing new demand for iron ore.
CHENG: Reform and opening-up remained the key themes of the session. Key areas under close watch include new strategic industries, factor market reform, aging population, fiscal reform, capital and financial market reform, and property market reform. Since setting up operations in China 30 years ago, DBS Bank has benefited greatly from the opening-up policy of China's financial market, and DBS China is well positioned to participate deeply in the development of China's financial market, coordinating the resources and network of DBS Group in the global region to provide differentiated financial support for the development of China's new quality productive forces.
Q2 In your view, how will the reform and opening-up measures rolled out at the plenum help strengthen the Chinese economy and bolster its prospects of achieving modernization? Do you think China's new reform and opening-up blueprint will make fresh contributions to the global economy? If yes, how?
LUSKIN: China's new reform and opening-up blueprint is poised to make substantial contributions to the global economy. By expanding market access and promoting international collaboration, China will create new opportunities for both domestic and foreign players. This inclusive approach is expected to drive growth across various industries, including the autonomous driving sector, especially given that electric vehicles are among the "new three "of China's exports.
We at Mobileye believe these reforms will enhance China's ability to innovate, empowering Chinese automakers to lead in technological advancements on a global scale and contribute significantly to the global economy. Mobileye is excited to be part of this transformative journey.
CHEN: The recent plenum emphasized advancing high-level technological self-reliance and strength, accelerating the establishment of institutional mechanisms to promote the development of the digital economy, and improving the policy system to promote the industrialization of digital industries and the digitalization of industries.
One of the advantages of working closely with our Chinese partners is the remarkable innovation, speed, knowledge, experience and competence in digitalization. For instance, in manufacturing — where automation is increasingly essential — Chinese industry leaders stand out for their rapid adoption and high levels of automation in production. This is crucial for IKEA as it helps improve efficiency and lower costs.
China, as the world's second-largest economy and the largest manufacturing hub, has unique advantages due to its large population base, economic scale and robust industrial foundation. China's production capacity is designed not only to serve its domestic market, but also to meet global demand. This means any innovation in China benefits not only the country itself, but also the broader global economy.
XIE: The new reform and opening-up blueprint will definitely contribute to the global economy, as it has injected fresh growth momentum into the economy. According to an analysis made by the International Monetary Fund, a 1 percentage point increase in GDP growth in China leads to a 0.3 percentage point increase in growth in other Asian economies, on average.
It is noteworthy that in the country's new blueprint, China promises to unilaterally open its doors wider to the world's least developed countries. This once again demonstrates China's responsibility and commitment as the world's second-largest economy, which is very admirable and will definitely benefit the global economy.
We believe that with a solid foundation for industrial development and growing domestic demand, China will continue to be an important engine of global growth.
CHENG: Taking a long-term view, the Chinese government is trying to restructure and remodel the Chinese economy for high-quality, sustainable growth. For instance, one important discussion topic of the third plenum was about advancing the cultivation of "new strategic industries". According to International Data Corp, China's AI-related hardware, software and services markets are expected to grow by 15.1 percent, 32 percent and 28.5 percent from 2021 to 2026, respectively. Strategic emerging sectors like these are vital for powering China's innovation-driven growth.
China is a major driver of growth in Asia and the world. We will continue to support China's real economy and its high-quality growth. We will beef up our support for China's inbound and outbound flows and capitalize on existing and emerging opportunities.
