Chinese Premier Criticizes West’s Economic De-risking From China—Experts Refute Remarks

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Chinese Premier Li Qiang criticized the West at the opening of the World Economic Forum for “de-risking” from China, calling it a “false proposition.” However, experts point out that Li’s remarks are unfounded, and the Chinese regime’s coercive economic tactics have caused many companies to move their production out of China to reduce risks.

The World Economic Forum—known colloquially as the “Summer Davos”—was held in Tianjin from June 27 to 29, with representatives from more than 90 countries and regions.

Li delivered a speech at the opening ceremony, criticizing the West for reducing their reliance on China.

“In the West, some people are hyping up what is called ‘cutting reliance and de-risking,’” Li told delegates.

“These two concepts … are a false proposition because the development of economic globalization is such that the world economy has become a common entity in which you and I are both intermingled.”

Li said Beijing “resolutely opposes politicizing economic and trade issues.”

“De-risking” was first proposed by President of the European Commission Ursula von der Leyen in March and supported by countries such as Germany, France, and the United States. The G-7 summit in Hiroshima in May also set the tone to respond to the Chinese Communist Party’s (CCP) economic coercion by “de-risking” rather than “decoupling” from the world’s second-largest economy.

De-risking ‘Is Not A False Proposition’

“This [de-risking] is not a false proposition. It is the real experience of various countries in the past few years,” Qiu Wanjun, a professor of finance at Northeastern University in Boston, told The Epoch Times on June 27.

“Looking back on the past three years, the global economy was disrupted, and the supply chain was broken due to the CCP’s draconian zero-COVID control policy, and the massive COVID-19 resurgence last December caused by the sudden and unprepared abandonment of all pandemic prevention measures.”

Qiu said this had caused turmoil in global markets, so Western countries have adopted a risk diversification approach to China. “Before Li Qiang said that this is a ‘false proposition,’ he should have actually reflected on what they [CCP] have done in the past three years to make Western countries think that they should reduce their economic dependence on China.”

Frank Xie, a professor of marketing at the Aiken School of Business at the University of South Carolina, told The Epoch Times on June 27: “In fact, the CCP has been using state power to restrict trade and use the economy as a means of coercion. For example, during the pandemic, the CCP used it to coerce other countries to achieve political goals by selling or refusing to sell urgently-needed supplies, such as masks and medical equipment, to other countries.

“De-risking is meant to remove the dangers of the CCP, the dangers caused by the CCP’s policies and politics. Actually, it’s to get rid of the CCP’s aggression and not give the CCP the opportunity and power to coerce them again. This is what de-risking means. They are indeed reducing this kind of risk,” Xie said.

A worker at a factory for Xinwangda Electric Vehicle Battery Co. Ltd, which makes lithium batteries for electric cars and other uses, in Nanjing in China’s eastern Jiangsu Province, on March 12, 2021. (STR/AFP via Getty Images)

CCP Politicizing Economy

In response to Premier Li’s remarks about how Beijing “resolutely opposes politicizing economic and trade issues,” Xie said: “It is the CCP itself that is politicizing it, and the West’s de-risking is meant to reduce political and regulatory risks, as the CCP is weaponizing and politicizing the economy. So It’s absurd for the CCP to call on other countries not to politicize. It’s like slapping themselves [CCP] in the face.”

Li said at the forum that the world is at the crossroads of historical changes. “In the process of economic globalization, there will be many headwinds and waves of reversal, and we should not return to the previous state of isolation.”

Qiu said of Li’s remark: “Actually, ‘de-globalization’ hasn’t happened, but the whole world’s supply chain is restructuring. Because we know the world’s supply chain and production and insurance costs are changing all the time, as well as the demand for finished products and the life cycle of products.

“In the process of restructuring, we have seen one of the trends, which is that countries around the world are reducing their dependence on China.”

Xie pointed out: “Li Qiang is confusing the concept. In fact, it is just a relocation of the industrial chain. After moving out of China, it is now done by countries such as ASEAN, Vietnam, and India. The world’s factories are still operating in India and Vietnam. So globalization now just excludes the CCP.”

Li said at the forum, “Enterprises have the most say, and the governments cannot do it for them.”

However, Xie pointed out that “the CCP itself is overstepping, using political power to interfere in the economy. It limits the production of some Chinese enterprises according to Beijing’s political needs. This is exactly what the CCP itself is doing.”

“Western governments are reducing risks, and Western enterprises are also reducing risks. The transfer of production chains is actually the enterprises themselves removing risks and looking for safer new industrial chains.”

Qiu believes that Li’s remarks intended to boost the confidence of foreign investors and restore international confidence in China’s economic development, but how much it can be realized remains to be seen.

Cheng Jing and Luo Ya contributed to this report.