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As tensions continue to escalate between the U.S. and China over Taiwan, and pressure has been building in the West for it to engage in a full economic coupling with Beijing, Jamie Dimon traveled to China for Wednesday's JPMorgan Chase & Co.'s China summit. During his first visit to the country since 2019, Dimon confirmed that his bank is committed to doing business with China regardless of economic circumstances.
Dimon noted that the situation between the U.S. and China is "far more complex now" and said, as CEO of the largest bank in the U.S., that he does not expect a decoupling between the two countries to take place.
During a Bloomberg Television interview Dimon said, "Over time, there'll be less trade. It'll take years for this thing to take place, but it won't be a decoupling and the world will go on."
The investor summit in Shanghai is the first major event the bank has held in mainland China since Beijing instituted its zero-Covid policy in 2020. China's lockdown was lifted at the end of 2022 but efforts to stimulate a recovery appear to be failing, according to a report by ZeroHedge.
The massive property sector and its related industries comprise more than a quarter of China's economy and have also struggled to come back online after Beijing lifted its draconian covid policies last year. According to CNBC, May saw prices increase in the housing market but sales stalled, while commercial property has seen drastic decreases in both pricing and transactions.
In an effort to help the property sector, Beijing has lessened its pressure on real estate developers over the last year after cracking down on developers' debt levels in August 2020. Meanwhile, the lack of sales has given investors pause about investing with Chinese developers as many doubt the developers' ability to repay their investments. Many investors are waiting to see if developers can generate enough revenue from property sales before agreeing to reinvest.
Dimon's summit was the day after Elon Musk arrived in Beijing to meet with Chinese Foreign Minister Qin Gang and announce that Tesla is against "decoupling" and wants to invest more in the country.
Meanwhile, Shanghai party head Chen Jining, who sits on the CCP's Politburo, told Dimon that Chinese officials hope the bank can bring in more international financial institutions to help investors in Shanghai.
While Dimon referred to himself as a patriot, he noted that he is willing to help the world's second-largest economy while it struggles with a "scary" 20- percent youth unemployment rate.
"We're here, we're going to support the Chinese people," Dimon said.
As China's recovery stalls and its factory activity falls faster than anticipated while its property sector struggles to stay afloat, it makes it all but impossible to decouple the world's largest and second-largest economies. Morgan Stanley's Global Director of Research, Katy Huberty, said that decoupling is "neither possible more desirable."
With both Dimon and Musk in support of assisting China's economy as the country continues its recovery from the pandemic lockdown, one must wonder if other American executives and investors feel the same way.
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