00:00China and the United States will try once again to resolve long-running trade friction
00:05with fresh talks in South Korea.
00:08The Vice Premier, He Lee Fung, is already in the country, leading a high-level delegation.
00:13U.S. Treasury Secretary Scott Besant flies in on Wednesday.
00:17Now, the talks come ahead of President Trump's visits to China later this week.
00:21Together with him, a strong business delegation, including CEOs of Tesla, Apple and Boeing.
00:30Well, let's take a look now at how some major U.S. companies are performing in China right now.
00:35First up, Tesla.
00:37The EV giant faced some headwinds in China in April,
00:41with domestic sales falling 10% year-on-year to just under 26,000 vehicles.
00:47But despite weaker Chinese sales, global deliveries from Tesla's Shanghai factory
00:53surged by more than a third to nearly 79,500 vehicles,
00:58highlighting the plant's strong production and export capacity.
01:02Next is Boeing, which is reportedly seeking to secure an historic deal with China
01:08for around 500 aircraft during Trump's visit.
01:11Back in 2017, during Trump's previous China visit, Boeing secured orders worth $37 billion.
01:19Last but not least is Apple and CEO Tim Cook.
01:23Apple's sales in China jumped 20% in the first quarter.
01:26The company has also lowered app store fees in China as it looks to strengthen its grip on Chinese consumers.
01:34Well, let's get more now from Santosh Rao, who's head of research and Manhattan Venture Partners.
01:41Thank you very much indeed for joining me.
01:43So when we look at the U.S. business delegation heading to Beijing,
01:47what does it tell us about Trump's priorities and what he actually hopes to achieve, do you think?
01:52Well, thanks for having me.
01:54Well, all these leaders represent categories that America needs to make a deal on.
02:01It's agricultural products, Boeing, Apple, and everyone has an interest in China.
02:07And those are the people going there in life sciences and other areas as well.
02:11So I think it's a very transactional business in that sense, transactional tour in that sense, transactional trip rather in
02:19this sense.
02:20But it's important, important for both countries, even for China, given all the geopolitical tensions,
02:26the tariffs and the global policy uncertainty.
02:31I think meeting these two countries meeting with 50 trillion between both of them in terms of economies,
02:40that's a huge thing that the whole world will be watching.
02:43We need these two countries to come to a state where they can come to some kind of a steady
02:48state and start doing business.
02:50So I think it's very important.
02:52All these leaders represent a category that the U.S. wants to make a deal in.
02:56And China is also willing to talk about it.
02:58And they have their own demands as well.
03:01What would success look like for these businesses, do you think?
03:05Yeah, I think there will be some deals announced.
03:08Maybe China will buy a few planes.
03:10They will relax a few ag products or agree to buy certain things.
03:16And China will also be, I mean, U.S. will agree to some relaxing, relaxing in terms of semiconductors, which
03:23looks doubtful.
03:24But I think they will relax and they will temper their talk about tariffs and other things, try to make
03:31it more seamless and take out the friction that's out there right now in terms of trade policy.
03:37I think that will be the biggest thing, that both countries come out of it saying that, OK, you know
03:41what?
03:41We're ready to do business.
03:43We put the worst thing behind us now.
03:45Let's move forward.
03:46We have some deals going on.
03:47Hopefully, China will honor their commitments and U.S. will honor Chinese commitments.
03:52So things like that.
03:53So I think if we can get that language out of them, that we have come to some kind of
03:57a working arrangement where there is less friction and ready to move forward.
04:01I think that will be the biggest success.
04:03Talking about friction, China's visa-free policy has seen a huge spike in travelers coming to the country, hasn't it?
04:10And therefore, how welcome would more Boeing planes be?
04:15And how much does Boeing need China, do you think?
04:18But Boeing needs China very much.
04:22And China needs more planes because, like you said, there is tremendous traffic, tremendous demand.
04:28One thing about Chinese market is that exports are a big part of Chinese economy right now.
04:34The internal consumption is kind of on the softer side.
04:37So I think exports play a big part in everything.
04:40So they need not only good relations, but they need a lot of movement around back and forth.
04:45So I think that will be good for Boeing and for the Chinese in a domestic market as well.
04:50But they can travel back and forth.
04:52There's less congestion, so to speak, and more free-flowing traffic between the two countries.
04:59Santosh Rao, thank you very much indeed for that.
05:02Anytime. Thank you.
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