Ningrong Liu

Opinion | How China’s ‘old friend’ diplomacy will shape its economic future

Faced with political isolation, economic decoupling and tech barriers, China is determined to woo US tech giants and businesses, undeterred in its quest to become a global hi-tech hub

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Ningrong Liu

Published: 7:30pm, 8 May 2024Updated: 8:10pm, 8 May 2024

Tesla founder and CEO Elon Musk’s surprise visit to Beijing before the Labour Day holiday was hailed as a pivotal moment for the electric vehicle maker, which has been grappling with soft demand and fierce competition. The company’s stock soared after it reportedly received in-principle approval to roll out its semi-autonomous driving technology in China and clearance for meeting key data security requirements.

The significance of the meeting between Chinese Premier Li Qiang and his “old friend” Musk should not be underestimated. It can be seen as a watershed, a valuable glimpse into China’s economic trajectory and the policies slated for discussion at the postponed third plenum in July.

Li’s intent is resolute: China will persist in opening up its economy, endeavour to ascend as a formidable technological force, foster collaboration with Western countries and fortify its economic might to propel worldwide progress.

The Li-Musk meeting evokes a memory from October 1970, when American journalist Edgar Snow stood alongside Mao Zedong at the Tiananmen gate tower. It sent a signal to Washington that China was prepared to align with the United States against the Soviet Union.

Today, China’s ambition and strategy is to surmount political isolation, economic decoupling and the technological separation imposed by the US. Its focus is on wooing the American business community and tech giants amid an economic cold war. China is undeterred in its quest to become a global hi-tech hub.

By embracing Tesla’s semi-autonomous driving technology, China aims to establish itself as a pioneer and testing ground for innovation. China’s new economic orientation will be propelled by high technology, with an emphasis on advanced manufacturing. This is the sole viable pathway for China to sustain long-term growth.