At Asia's Davos, China's Xi blasts 'Cold War mentality' of US

At “Asia’s Davos,” Chinese President Xi Jinping castigated Washington's "cold war mentality" while promising to open China's markets even wider.

His address was given to the annual Boao Forum for Asia in Hainan, China. Mr Xi says China will work to reduce tariffs on automobiles, strengthen protection of intellectual property and begin an initiative to boost imports as part of "a new phase of opening up."

As a result, US stocks were higher as investor concerns about rising US-China trade tension eased after Mr Xi's remarks, which also coincide with the 40th anniversary of economic reform initiated by Deng Xiaoping.

The Dow Jones Industrial Average rose 428.90 points, or 1.79%, to 24,408.00. The S&P 500 gained 43.71 points or 1.67% to 2656.87 and the Nasdaq Composite added 143.96 points, or 2.07%, to 7092.24. The S&P 500 posted six new 52-week highs and one new low and the Nasdaq Composite recorded 47 new highs and 30 new lows.

"With regard to all those major initiatives I have just announced, we have every intention to translate them into reality sooner rather than later. We want the outcomes of our opening up efforts to deliver benefits as soon as possible to all enterprises and people in China and around the world,” Mr Xi told the forum.

He outlined the gains Chinese people have received from the country’s opening over the past four decades but avoided discussing the slowdown over recent years. Although Mr Xi did not mention US tariff threats, he offered an alternative vision of global development to the American nationalist model.

"Openness versus isolation and progress versus retrogression, humanity has a major choice to make. In a world aspiring for peace and development, the cold war mentality and zero-sum mentality look even more out of place.”

He also called for "a new approach to state-to-state relations, featuring dialogue rather than confrontation and partnership instead of alliance."

Declaring that "China does not seek a trade surplus," Mr Xi promised to boost imports, including by reducing tariffs on autos and additional products and ease foreign ownership restriction in cars, shipbuilding and aircraft.

"Investment is like air and only fresh air attracts more investment from the outside," he says.

To do that, China will increase alignment with international investing rules, increase transparency, strengthen property protection, uphold the rule of law, encourage competition and oppose monopoly.

Oil prices lift
Brent oil prices surged above $US70 a barrel as concerns of a trade war recede. Brent has gained 4.5% over two trading days.

China’s President helped allay fears by promising to open China’s economy and lower import tariffs. The see-sawing on trade has pushed oil benchmarks all over the place. “It’s not so much ‘risk on/risk off’ as it is ‘trade war on/trade war off’ and, at the moment, we’re ‘trade-war off’,” says London Capital Group’s Jasper Lawler.

US oil exports surged to 2.175 million barrels a day in the last week of March, up nearly 30% from the previous week. Analysts suggest it could go up to probably 20 million or more a week, and perhaps to 2.5 million barrels a day.

Experts to check on Syria
US President Donald Trump cancelled a scheduled trip to South America to attend the Summit of the Americas in Peru, as he decides on a response to the recent alleged chemical weapons attack in Syria.

Meanwhile, the Hague-based Organisation for the Prohibition of Chemical Weapons (OPCW) issued a press release saying it will deploy a fact-finding mission team to Syria. The OPCW technical secretariat has asked Syria to prepare for the deployment.

“There was no chemical weapons attack,” the Russian ambassador to the UN Vassily Nebenzia says, and that “Russia is being unpardonably threatened.” Mr Nebenzia claimed the attack was staged and warned that any US military action could have “grave repercussions.”

Russian President Vladimir Putin “stressed the unacceptability of provocation and speculation on this matter” during a phone call with German Chancellor Angela Merkel yesterday, according to a statement by the Kremlin.

The US plans to call a UN Security Council vote today on a resolution to establish a new investigation into the claims.

Meetings galore planned for North Korea
Later this month, the first summit in more than a decade between the leaders of North and South Korea is set to take place at the border truce village of Panmunjom.

By the end of May or in early June, US President Donald Trump and North Korean leader Kim Jong-un are expected to hold the first ever US/NK discussion, potentially in the Mongolian capital of Ulaanbaatar. Japan also has offered Pyongyang a leaders' meeting.

Mr Kim has made his first public acknowledgement of a potential summit with Mr Trump, ending a long silence during which some questioned Pyongyang’s willingness to hold talks.

“We have a meeting that is being set up with North Korea, so that will be very exciting, I think, for the world,” Mr Trump says.

Facebook in the hot seat
Forty-four lawmakers in the US Senate are grilling the 33-year-old Facebook CEO Mark Zuckerberg today.

Democrats intend to focus on lax oversight of privacy and Kremlin meddling while Republicans are likely to compare the Cambridge Analytica scandal to President Barack Obama's 2012 re-election campaign use of Facebook data.

One day before the hearing Facebook launched a charm offensive by notifying the at least 87 million users whose info was passed to Cambridge Analytica. It also announced a new programme designed to help researchers review the role of social media in elections.

Facebook Inc shares rose 3.5% after Mr Zuckerberg began his testimony before Congress.

All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.