Apple CEO Tim Cook will be among a small group of top US executives attending a high-profile summit hosted by the Chinese government this weekend, in a show of commitment to the market amid decoupling risks and supply chain adjustments.
The head of the world’s most valuable company will join Jon Moeller, CEO of consumer goods giant Procter & Gamble; Stephen Schwarzman, CEO of investment firm Blackstone; and Ray Dalio, founder of the world’s largest hedge fund Bridgewater Associates, at the China Development Forum (CDF), according to the event’s website.
The two-day meeting, viewed as Beijing’s answer to the World Economic Forum’s annual summit in Davos, Switzerland, will be the first offline CDF gathering in three years since the Covid-19 outbreak.
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Apple CEO Tim Cook visits the Sanlitun Apple Store in Beijing on Friday. Photo: Weibo alt=Apple CEO Tim Cook visits the Sanlitun Apple Store in Beijing on Friday. Photo: Weibo>
Multinational executives attending the event, held at the Diaoyutai State Guesthouse in the Chinese capital city, are set to rub shoulders with China’s economic ministers and top officials.
Over the years, foreign business leaders were often granted the chance to meet China’s prime minister. This year’s event may see Li Qiang, the new premier, meet C-suite executives from overseas for the first time since he took the top job this month.
The closed-door summit will take place as international businesses are reassessing their presence and prospects in the country following its draconian three-year pandemic lockdowns and amid rising geopolitical tensions.
Apple and its contract manufacturers, for example, have been relocating some of their production lines out of mainland China to places such as Vietnam and India.
New Chinese Premier Li Qiang waves prior to attending his first press conference after his appointment to the post at the Great Hall of the People in Beijing on March 13. Photo: Kyodo alt=New Chinese Premier Li Qiang waves prior to attending his first press conference after his appointment to the post at the Great Hall of the People in Beijing on March 13. Photo: Kyodo>
While Cook may be trying to reduce Apple’s reliance on China and has made progress, the world’s second-largest economy remains an important market for the company, according to Brock Silvers, chief investment officer at private equity firm Kaiyuan Capital.
“Despite trying to exit China, Apple still maintains an important business relationship there, and thus it makes perfect sense for Cook to participate at the CDF,” said Silvers. “It’s also likely to be a strong marketing move, as Cook is generally treated as a star in China.”
On Friday afternoon, Cook was seen visiting the Apple Store in Beijing’s Sanlitun area, the US technology giant’s largest shop in Asia, surrounded by crowds, according to several local media reports.
Despite US-China political tensions, Apple’s products remain popular among Chinese consumers. The company was the top smartphone vendor in the country in the fourth quarter, with one out of every four smartphones sold last October being an iPhone, according to consultancy Counterpoint.
Cook first attended the CDF in 2017, just months before Apple toppled Samsung Electronics as the world’s largest smartphone maker thanks to strong growth in China and other regions.
From 2018 to 2021, he had attended the forum every year with the exception of 2020, which was the height of the global coronavirus pandemic, according to the CDF website.
Cook and his peers attending this year’s CDF have two conflicting desires, according to William Yuen Yee, a research assistant at the Columbia-Harvard China and the World Programme.
“On the one hand, US companies like Apple want to reduce their presence in China to avoid getting caught in the crossfire of escalating Washington-Beijing tensions,” he said. “On the other hand, the Chinese consumer market remains crucial, trade ties remain robust, and the world’s largest economies have yet to decouple.”
People walk by an Apple store at a tourist shopping street in Beijing. Photo: AP Photo alt=People walk by an Apple store at a tourist shopping street in Beijing. Photo: AP Photo>
While presence at the event, organised by China’s National Development and Reform Commission, will help US executives endear themselves to the country’s leaders, they will have to fend off political pressure in Washington, according to Duncan Clark, founder and chairman at investment advisory BDA China.
“[Cook] continues to be in a tricky position, straddling the need to show commitment to China, which plays such a crucial role, and to be responsive to growing and bipartisan animosity towards China at home,” Clark said.
“CDF for US companies especially is tricky now,” he added. “To quote Deng Xiaoping, now it’s best that the US CEOs with a big China presence ‘hide and bide’ … hide their presence in China as much as possible from scrutiny at home, and bide their time hoping US-China relations improve one day.”
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP’s Facebook and Twitter pages. Copyright © 2023 South China Morning Post Publishers Ltd. All rights reserved.
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