Snitz explains why Xi's trip is important.

The fact that Xi Jinping is here for the first time in six years, hat in hand is important...very important. What he talked about is far less critical than his presense and the conditions that led to his visit.

What are those conditions? China's ecoomic output rests on three legged stool. One leg is their housing section which has been expanding at an exponential pace. That sector is massively overbuilt and may be the largest RE bubble this planet has ever witnessed. Leg 2 is a giant supply of low cost service and manuf workers that produce for the nation. Wage rates for that cohort have gone up 1000% in 13 yearS. They're no longer low cost and their numbers are being erode by aging. Which brings us to the third leg. China has the lowest fertility rate any major on the planet. Almost a third of their population will soon be over 65 and their are insufficient younger workers to take their place.

Xi realizes he's alienated the EU and US. That normally might not matter but his economy (unlike the US) runs on exports. If he loses his customers (who are pivoting to other Asian supply chains) he's dead.

If I know that and he knows that. That's why he's here. Contrary to what many fear, I suspect he knows he's stepped in in.

U.S. Executives Get No Reassurance From Xi on Tougher China Business Environment

Chinese leader makes no mention of trade and investment at dinner with business leaders

By Lingling Wei and Charles Hutzler, WSJ

Updated Nov. 16, 2023 4:21 pm ET

SAN FRANCISCO—Foreign capital is fleeing China. Yet on his first trip to the U.S. in six years, Chinese leader Xi Jinping didn’t make a pitch to win back American businesses and investors.

Instead, at a Wednesday evening dinner with U.S. corporate chiefs and other guests, Xi sought to enlist American corporations’ help in easing bilateral tensions, emphasizing the room for both nations to work together—a theme of his meeting with President Biden earlier in the day.

To the business leaders, Xi said, “China is pursuing high-quality development, and the United States is revitalizing its economy,” while adding: “There is plenty of room for our cooperation.”

The absence of any mention of trade and investment, let alone reassurance for businesses jarred by an increasingly tough environment in China, surprised and dismayed some of the executives in attendance, who described it as a missed opportunity.

“I, too, was disappointed that Xi didn’t take the opportunity to address the American business community’s concerns about the operating environment in China,” said Andy Rothman, an investment strategist at Matthews Asia, a U.S.-based fund manager, “or to share his thoughts on how his domestic economic policies might evolve in the coming quarters.”

A day after meeting with Chinese leader Xi Jinping, President Biden said during a speech at the APEC CEO Summit that the U.S. is ‘de-risking and diversifying’ its economic relationship with China, but ‘not decoupling.’ Photo: Kevin Lamarque/Reuters

The business leaders gathered at the Hyatt Regency in downtown San Francisco greeted Xi with a standing ovation as the Chinese leader went on stage, introduced by insurer Chubb CEO Evan Greenberg.

In attendance were chief executives including Apple’s Tim Cook and BlackRock’s Larry Fink, along with leaders and senior executives from Qualcomm, Boeing, Blackstone, KKR, Pfizer, FedEx and other large U.S. firms, which all invest in China and collectively have trillions of dollars in market value. Tesla CEO Elon Musk and Salesforce CEO Marc Benioff greeted Xi during the predinner reception but didn’t stay for the dinner.

One special guest symbolized historic cooperation between the two countries: a former Flying Tiger fighter pilot who helped China fight Japan during World War II.

The business leaders applauded Xi’s speech several times, including when he indicated the possibility of China sending new pandas to the U.S. as envoys of friendship. “We are ready to continue our cooperation with the United States on panda conservation,” Xi said.

But Xi’s cooperation message sounded tone deaf to some in the audience at a time when the risks for businesses operating in China have increased substantially. Western management consultants, auditors and other firms have been hit with raids, investigations and detentions. Meanwhile, new espionage and data-security laws threaten to criminalize routine business activities.

Chinese leader Xi Jinping on Wednesday sought to enlist U.S. businesses’ help in easing tensions, a theme of his earlier meeting with President Biden.

“He offered no hints of concessions to business or even interest in more investment in the Chinese economy,” said a senior American business executive who attended the dinner. “The speech was propaganda at its finest.”

In some corners, however, Xi was applauded for following through with a visit to the U.S., even if he spoke in generalities. “He could have had a speech that was more aggressive and nationalistic, defending China,” said Sadek Wahba, an investor who chairs an institute on strategic competition at Wilson Center. “Maybe it’s a false sense of comfort, but in my view it’s a positive.”

U.S. officials have said Washington will try to get Beijing to back off on its pressure on American companies through newly established working groups between the two governments.

Wendy Cutler, vice president of the Asia Society Policy Institute and a former senior U.S. trade official, who also attended Wednesday’s dinner, said, “all eyes will now be on the working groups to see whether they will go beyond the ‘talk shop’ mode to achieve meaningful outcomes.”

Xi came to San Francisco this week with the dual mission of stabilizing relations with the U.S. and restoring investor confidence in China’s economy.

Can Xi Jinping persuade American CEOs to invest in the China economy? Join the conversation below.

Foreign firms yanked more than $160 billion in total earnings from China during six successive quarters through the end of September, according to a Wall Street Journal analysis of Chinese data.

Xi and his lieutenants want to stem the exodus of foreign capital that for years had helped drive China’s growth. In the way of that effort is the leader’s own national-security agenda that puts fending off perceived foreign threats ahead of development.

That Xi didn’t mention trade and investment with the U.S. contrasted with the remarks given by U.S. Commerce Secretary Gina Raimondo at the dinner honoring Xi. In a welcoming tone, Raimondo said that “we want robust trade with China” even as both nations put national security as their priority.

“We will protect as we must and promote as we can,” Raimondo said.

Apple Chief Executive Tim Cook was among the business leaders who attended the dinner with the Chinese leader.

At their summit Biden and Xi agreed to resume military contacts, restart cooperation on fentanyl and open a new dialogue on the risks posed by artificial intelligence.

A remark by Biden after the leaders’ summit in response to a reporter’s question of whether he sees Xi as a dictator—to which Biden replied, “Well look, he is.”—drew a rebuke from a Chinese Foreign Ministry spokeswoman, who called it “irresponsible” during a regular media briefing in Beijing on Thursday, according to the Associated Press. But Beijing also signaled it didn’t want to draw too much attention to the remark, leaving any reference to the remark out of the ministry’s official transcript of the briefing.

At the Wednesday night dinner, there were some notable absences compared with a similar dinner in Seattle in 2015 when Xi brought along high-profile tech CEOs including Alibaba founder Jack Ma. This time, even though the dinner was in the tech hub of San Francisco, there were barely any Chinese entrepreneurs, and fewer U.S. tech leaders, such as Meta Platforms CEO Mark Zuckerberg, despite the dinner’s proximity to Silicon Valley.

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The event took place on a night when many business leaders were already committed to a separate dinner Biden hosted for leaders from countries along the Pacific Rim who were in town for the Asia-Pacific Economic Cooperation meeting.

For American CEOs, the optics of being seen wining and dining with the Chinese leader have changed since 2015 amid increased scrutiny from lawmakers in Washington.

Mike Gallagher, chairman of a House Select Committee on China, is demanding that the two main sponsors of the dinner in Xi’s honor—the National Committee on U.S.-China Relations and the U.S.-China Business Council—disclose the names of those who bought tickets, either the $2,000 per-person general-admission ticket or the $40,000 fee to sit at the table with the Chinese leader.

Gallagher called the spending unconscionable given China’s “genocide against millions of innocent men, women, and children in Xinjiang.” China denies that allegation.

Weakness in Chinese stocks appeared to indicate market disappointment with the summit. Hong Kong’s Hang Seng Index fell nearly 1.4% and the Shanghai Composite Index fell 0.71%.

James T. Areddy contributed to this article.

Write to Lingling Wei at Lingling.Wei@wsj.com and Charles Hutzler at