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Yahoo
4 hours ago
- Business
- Yahoo
Why AstraZeneca risks Trump's wrath with bet on China
When Pascal Soriot flew in to speak at the Boao Forum in China this year, many expected him to keep a low profile. With Donald Trump and Xi Jinping firing shots at each other in an ever-escalating trade row, it was presumed that the AstraZeneca boss would want to keep his head down. Yet Soriot was happy to make his position clear: 'The two large innovators in our industry today are the US and China,' the no-nonsense Frenchman said on the sidelines of the forum, and China was set to 'emerge as really a driving force for innovation in our sector'. Days later, Soriot was one of 40 Western executives summoned to a gathering with Xi Jinping, orchestrated to cement ties between global corporations and Beijing. 'China is absolutely open for us,' Soriot said. Such statements threaten to thrust AstraZeneca into the spotlight at a time when US and China leaders are painfully sensitive to where companies are spending their cash. In recent months, Trump has sought to exert growing power over where companies are investing. In particular, he is keen to ensure it is not in China. Trump has threatened heavy tariffs on Apple unless it moves its manufacturing out of China and the trade deal with the UK struck earlier this year handed the US a 'veto' over Chinese investment in Britain. While the US president's focus has so far been on pulling manufacturing jobs back to America, many company chiefs are wary of finding themselves in Trump's firing line. For pharmaceutical companies, there are particular risks. Trump this year threatened new tariffs on pharmaceuticals, adding: 'When they hear that, they will leave China.' The US is currently in the middle of an investigation into drug imports, which could be a precursor to action. For AstraZeneca, which does not ship drugs between the US and China, it may seem like they should be immune. Yet Trump's unpredictability means nothing can be assumed – and the president has been clear he wants companies to invest in the US, not China. The president's push to make multinationals choose between the US and China is awkward for AstraZeneca, Britain's biggest pharmaceuticals company. AstraZeneca has been in China for more than 30 years and is the largest drugmaker in the country. It made its first foray into the US in the 1970s and now makes 42pc of its revenues there. Both countries have benefited from recent investment from the British drugmaker. Last November, AstraZeneca put $3.5bn into the US to expand its research and manufacturing facilities. It unveiled a $2.5bn (£2.6bn) new centre in Beijing in March. Two weeks ago, AstraZeneca announced a new strategic partnership with China's CSPC Pharmaceuticals Group, worth up to $5.3bn. Michel Demaré, the company's chairman, insists the business is above the fray. 'When you are a global company like AstraZeneca you have always to cope with geopolitical risk,' he told the Financial Times in 2023. 'You have to try to manage that without getting too involved.' Yet taking a studiously neutral approach is becoming ever more difficult. When it comes to Trump, 'the company will have to manage a tightrope to ensure that they are not going to be penalised for their commitment to China and the wider Asian region,' says Ketan Patel, a fund manager at Whitefriars who is an AstraZeneca investor. Over the past few years Soriot has not been shy in voicing his admiration of China. This year, he said that the nation was paving the way in fast-moving areas including antibody drug conjugates and cell therapy. 'They're very committed to China,' says Emily Field, a Barclays analyst who follows the company. 'And that's because there's going to be this huge volume opportunity where Chinese local players are not able to produce drugs.' Patel believes recent pledges from AstraZeneca to do more research in the country and strike deals with Chinese biotechs are a risk move. 'Research and development is a long duration activity and the current partnerships with local players is very much at a nascent stage.' It is not hard to see why some investors are nervous. This year, more than 100 of AstraZeneca's former sales staff were jailed in China over alleged medical insurance fraud. The National Healthcare Security Administration claimed AstraZeneca staff had been involved in scamming medical insurance companies. At the same time, Chinese authorities have been investigating alleged illegal imports of unapproved medicines. AstraZeneca has said it risks millions of dollars worth of fines. Perhaps most seriously for AstraZeneca is the situation surrounding Leon Wang, its country president in China. He was then detained in China last autumn amid an investigation into AstraZeneca's activities in the country and remains in detention today. AstraZeneca says it has been unable to speak to him. 'We all think [about] and miss Leon,' Soriot said this year. 'We certainly wish him the best and we all hope that he's in good, good shape and dealing with a very difficult situation in the best possible way.' Wang has been put on 'extended leave' and replaced for now. Amnesty International said earlier this year the case raised 'difficult ethical questions' about AstraZeneca staying in China. The drugs giant argues that its role as a manufacturer of medicine means it has a moral right to be in as many countries around the world as it can. It has, for example, kept operating in Russia even as other companies have quit over the war in Ukraine. Still, AstraZeneca is not just remaining in China but ramping up its investments. With Beijing pushing to make the country a better place to create new drugs and run clinical trials, Soriot has hailed the country's pharmaceutical market as 'incredible'. By the end of last year, AstraZeneca had over 200 projects in development in China. The company, which currently has around 40 medicines in China, has around 100 new medicines expected to be approved in China in the next five years. Soriot argues that he has little choice but to turn to China, given ever increasing tax and red tape in Europe make it harder to get things done. In April, Soriot said the continent was 'falling behind in attracting R&D and manufacturing investments, putting its ability to protect the health of its own people at risk'. There is a potential for things to change. This week, UK ministers have been thrashing out plans to try to boost Britain's competitiveness in an effort to attract more life sciences investment from the likes of AstraZeneca. On Thursday, talks were under way to try to come to an agreement on the contentious issue of NHS charges paid by drugmakers. Labour is expected to publish its own overarching life sciences strategy imminently. For now, though, AstraZeneca is focused on China – despite the risks of angering Trump. 'Of course, the US remains extremely important,' Soriot said in April. 'It's the biggest innovation part of the industry. But China is rapidly ramping up and so it's important for us to remain very committed to China.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
a day ago
- Business
- Telegraph
AstraZeneca defies Trump to bet on China
When Pascal Soriot flew in to speak at the Boao Forum in China this year, many expected him to keep a low profile. With Donald Trump and Xi Jinping firing shots at each other in an ever-escalating trade row, it was presumed that the AstraZeneca boss would want to keep his head down. Yet Soriot was happy to make his position clear: 'The two large innovators in our industry today are the US and China,' the no-nonsense Frenchman said on the sidelines of the forum, and China was set to 'emerge as really a driving force for innovation in our sector'. Days later, Soriot was one of 40 Western executives summoned to a gathering with Xi Jinping, orchestrated to cement ties between global corporations and Beijing. 'China is absolutely open for us,' Soriot said. Such statements threaten to thrust AstraZeneca into the spotlight at a time when US and China leaders are painfully sensitive to where companies are spending their cash. In recent months, Trump has sought to exert growing power over where companies are investing. In particular, he is keen to ensure it is not in China. Trump has threatened heavy tariffs on Apple unless it moves its manufacturing out of China and the trade deal with the UK struck earlier this year handed the US a 'veto' over Chinese investment in Britain. While the US president's focus has so far been on pulling manufacturing jobs back to America, many company chiefs are wary of finding themselves in Trump's firing line. For pharmaceutical companies, there are particular risks. Trump this year threatened new tariffs on pharmaceuticals, adding: 'When they hear that, they will leave China.' The US is currently in the middle of an investigation into drug imports, which could be a precursor to action. For AstraZeneca, which does not ship drugs between the US and China, it may seem like they should be immune. Yet Trump's unpredictability means nothing can be assumed – and the president has been clear he wants companies to invest in the US, not China. The president's push to make multinationals choose between the US and China is awkward for AstraZeneca, Britain's biggest pharmaceuticals company. AstraZeneca has been in China for more than 30 years and is the largest drugmaker in the country. It made its first foray into the US in the 1970s and now makes 42pc of its revenues there. Both countries have benefited from recent investment from the British drugmaker. Last November, AstraZeneca put $3.5bn into the US to expand its research and manufacturing facilities. It unveiled a $2.5bn (£2.6bn) new centre in Beijing in March. Two weeks ago, AstraZeneca announced a new strategic partnership with China's CSPC Pharmaceuticals Group, worth up to $5.3bn. Michel Demaré, the company's chairman, insists the business is above the fray. 'When you are a global company like AstraZeneca you have always to cope with geopolitical risk,' he told the Financial Times in 2023. 'You have to try to manage that without getting too involved.' Yet taking a studiously neutral approach is becoming ever more difficult. When it comes to Trump, 'the company will have to manage a tightrope to ensure that they are not going to be penalised for their commitment to China and the wider Asian region,' says Ketan Patel, a fund manager at Whitefriars who is an AstraZeneca investor. Over the past few years Soriot has not been shy in voicing his admiration of China. This year, he said that the nation was paving the way in fast-moving areas including antibody drug conjugates and cell therapy. 'They're very committed to China,' says Emily Field, a Barclays analyst who follows the company. 'And that's because there's going to be this huge volume opportunity where Chinese local players are not able to produce drugs.' Patel believes recent pledges from AstraZeneca to do more research in the country and strike deals with Chinese biotechs are a risk move. 'Research and development is a long duration activity and the current partnerships with local players is very much at a nascent stage.' It is not hard to see why some investors are nervous. This year, more than 100 of AstraZeneca's former sales staff were jailed in China over alleged medical insurance fraud. The National Healthcare Security Administration claimed AstraZeneca staff had been involved in scamming medical insurance companies. At the same time, Chinese authorities have been investigating alleged illegal imports of unapproved medicines. AstraZeneca has said it risks millions of dollars worth of fines. Perhaps most seriously for AstraZeneca is the situation surrounding Leon Wang, its country president in China. He was then detained in China last autumn amid an investigation into AstraZeneca's activities in the country and remains in detention today. AstraZeneca says it has been unable to speak to him. 'We all think [about] and miss Leon,' Soriot said this year. 'We certainly wish him the best and we all hope that he's in good, good shape and dealing with a very difficult situation in the best possible way.' Wang has been put on 'extended leave' and replaced for now. Amnesty International said earlier this year the case raised 'difficult ethical questions' about AstraZeneca staying in China. The drugs giant argues that its role as a manufacturer of medicine means it has a moral right to be in as many countries around the world as it can. It has, for example, kept operating in Russia even as other companies have quit over the war in Ukraine. 'Incredible' Still, AstraZeneca is not just remaining in China but ramping up its investments. With Beijing pushing to make the country a better place to create new drugs and run clinical trials, Soriot has hailed the country's pharmaceutical market as 'incredible'. By the end of last year, AstraZeneca had over 200 projects in development in China. The company, which currently has around 40 medicines in China, has around 100 new medicines expected to be approved in China in the next five years. Soriot argues that he has little choice but to turn to China, given ever increasing tax and red tape in Europe make it harder to get things done. In April, Soriot said the continent was 'falling behind in attracting R&D and manufacturing investments, putting its ability to protect the health of its own people at risk'. There is a potential for things to change. This week, UK ministers have been thrashing out plans to try to boost Britain's competitiveness in an effort to attract more life sciences investment from the likes of AstraZeneca. On Thursday, talks were under way to try to come to an agreement on the contentious issue of NHS charges paid by drugmakers. Labour is expected to publish its own overarching life sciences strategy imminently. For now, though, AstraZeneca is focused on China – despite the risks of angering Trump. 'Of course, the US remains extremely important,' Soriot said in April. 'It's the biggest innovation part of the industry. But China is rapidly ramping up and so it's important for us to remain very committed to China.'
RTHK
06-06-2025
- Business
- RTHK
Youths 'can bridge AI gap between Global South, North'
Youths 'can bridge AI gap between Global South, North' Boao Forum for Asia secretary general Zhang Jun, right, says artificial intelligence development gaps will fuel further digital divisions. Photo: RTHK Participants at the forum at the Convention and Exhibition Centre said access and skills for youths and young entrepreneurs posed challenges for their economies. Photo: RTHK Boao Forum for Asia secretary general Zhang Jun said on Friday youths play a key role in bridging the artificial intelligence development gap between the Global South and Global North. He made the remarks as the International Science, Technology and Innovation Forum of the Boao Forum made its debut in Hong Kong, with previous editions held in Macau, Zhuhai and Guangzhou. Speaking at a roundtable session, Zhang, who served as a permanent representative of China to the United Nations, said the digital divide, which includes AI development gaps, will further weigh on global fragmentation. He called on youths to help forge global collaboration to tackle such challenges. "Youths have a key role... in really trust-building, partnership-building, which is also badly needed in today's world, because we are more divided than [at any time] after the end of the Second World War. "And we are living in a world which is becoming very much dangerous because of the failure of the international governance system, including the United Nations," Zhang said. Many of the forum's participants pointed out challenges encountered during their countries' own digital transformation, especially with access and skills for youths and young entrepreneurs. Many said it's essential to ramp up digital literacy training and partnerships between nations. Mimala Chanthasone, an official of the Institute of Foreign Affairs in Laos, cited the China-Laos AI Innovation Cooperation Centre as an example. Launched in February, she said the centre marks the first China-Asean AI innovation cooperation. Conrad Ho, a member of the Youth Development Commission, called for more efforts to be made to address the employability gap created by the emergence of AI technology. "The post-AI world presents many challenges and also opportunities, including how youth might gain more senior-level skills as AI reduces the demand for entry-level and middle-management roles," he said. "I think as AI unlocks more capacity, we're going to transition from [having more] large corporations to smaller ventures, one-person teams, smaller teams that can still create very massive value. "And yet for all these companies, for them to be successful, the founders still need to have the critical hard and soft skills that they need to learn." The two-day innovation forum ends on Saturday.
South China Morning Post
03-06-2025
- Business
- South China Morning Post
2 global conferences to make Hong Kong debut this month: John Lee
Two international conferences will be held in Hong Kong for the first time this month, Chief Executive John Lee Ka-chiu has revealed, pledging authorities will continue to attract more events to bring in high-end tourists and enhance the city's global network. The city leader said on Tuesday that several international conferences had made their Hong Kong debuts over the past three years, and two more important events would follow this month. They are the International Science, Technology and Innovation Forum of the Boao Forum for Asia 2025, taking place from Friday to Saturday, and the International Conference on Roads and Railways 2025, taking place next Thursday and Friday. Both will be hosted at the Hong Kong Convention and Exhibition Centre in Wan Chai. 'Since taking office, I have been actively expanding Hong Kong's international network by calling for more international conferences, including those with new themes, to create fresh opportunities for the city,' Lee said before his weekly meeting with the key decision-making Executive Council 'International major conferences represent the high-quality segment of the conference economy. They attract high-spending, overnight and high-end business travellers to Hong Kong. The government will continue its efforts to bring more new and large-scale international conferences to Hong Kong.'
Washington Post
31-03-2025
- Business
- Washington Post
China offers ‘safe' place for investment, Xi tells execs amid trade war
Chinese leader Xi Jinping gathered dozens of foreign business executives Friday for a rare in-person meeting and urged them to see China as an 'ideal, safe and promising' place to invest amid President Donald Trump's destabilizing trade conflicts. Xi's meeting with over 40 international executives and trade association heads capped a week-long charm offensive in which Chinese officials promised to be friendly to business — and took swipes at 'rising protectionism' from the Trump administration. 'China was, is and will be an ideal, safe and promising investment destination for foreign investors,' Xi told the gathering, which included leaders from American businesses including Pfizer, FedEx and asset manager Blackstone. 'Going with China is going with opportunities, believing in China is believing in tomorrow, and investing in China is investing in the future.' The grand meeting room in the Great Hall of the People contained a who's who of multinational firms with extensive operations in China. While Xi has hosted similar meetings before, it is rare for him to bring together so many members of the global business elite at once, or to speak with them so plainly about his hopes for investment. 'I often say that blowing out other people's lights will not make your own light brighter,' Xi said, in an apparent swipe at Trump without naming him directly. Executives from the United States included Albert Bourla, CEO of pharma giant Pfizer; Raj Subramaniam, president of logistics provider FedEx; and Stephen A. Schwarzman, chairman of Blackstone. Notably, Apple CEO Tim Cook, who was also in China this week, did not attend the Beijing meeting. Subramaniam was invited to speak, alongside executives from Mercedes-Benz, Hitachi, HSBC and Saudi Aramco, according to the state-run Xinhua News Agency, which summarized their collective remarks as noting that China had 'become an oasis of certainty' against intensifying protectionism. At two major gatherings of international business executives in the past week — the China Development Forum in Beijing and the 'Asian Davos' Boao Forum on the tropical island of Hainan — Chinese officials tried to reassure companies that they are welcome and can still make money in China. That message is not new. In Trump's first term, Xi similarly positioned China as the defender of globalization and free trade — only to then launch a sweeping regulatory crackdown that crippled the tech sector and resulted in billions in losses for international investors. But the Trump administration has slapped duties on allies and rivals alike, and is preparing to impose new tariffs on 15 trade partners next week. Beijing sees an opening to bolster its relationships with multinationals — whether from the United States or its allies in Europe and Asia — to help navigate trade tensions and boost China's slowing economy, analysts said. 'Politically, China hopes that these executives will exert influence on their own governments when they return,' said Xin Qiang, deputy director of the Center for American Studies at Fudan University in Shanghai. 'A large number of American companies have invested and set up factories in China. When they return, they can tell Trump that the tariff war will also hurt American businesses,' Xin said. It might be a hard sell. Hanging over Beijing's overtures is an imminent escalation in what threatens to become an all-out trade war with the Trump administration — one that could easily draw in American businesses operating in China. Beijing has signaled it is open to a deal with Trump, who has promised 'flexibility' in tariff negotiations. But it has also vowed not to bow to pressure and responded immediately when Trump imposed an additional 20 percent in tariffs, taking average U.S. duties on Chinese goods to about 33 percent. On Sunday, Premier Li Qiang called for 'candid communication' in a meeting with Sen. Steve Daines (R-Montana), a strong Trump supporter who has presented himself as laying the groundwork for a Trump-Xi summit. Despite Friday's turnout and reportedly upbeat statements from CEOs, China's message of stability and openness has been undercut by its increasing willingness to target international companies in its trade dispute with the Trump administration. The State Council, or cabinet, on Monday passed an 'anti-foreign sanctions law,' adding another tool to Beijing's sweeping efforts to sharpen weapons of retaliation for trade disputes. Chinese authorities have sanctioned a growing number of American firms, primarily arms dealers, by placing them on its 'unreliable entities list.' It is also investigating U.S. chipmaker Nvidia for suspected antitrust violations. During Trump's last trade war with China, the state-run Global Times newspaper threatened similar measures against Apple, Qualcomm and Cisco. There was little sign of those threats this week as Apple's Cook and Qualcomm's Cristiano Amon were among American chief executives receiving extensive face time with top Chinese officials for economics and trade, including Commerce Minister Wang Wentao, Vice Premier He Lifeng and Premier Li. American executives have also used the week to underscore their commitment to the world's second-largest economy and show that their businesses are aligned with Xi's priorities. Cook on Monday launched a $100 million fund to add 550,000 megawatt-hours worth of wind and solar power to the country's already world-beating renewable-energy installations. He then toured the tech hub of Hangzhou, hometown online retail giant Alibaba and artificial intelligence start-up DeepSeek. There, the Apple CEO received a hero's welcome, with martial arts performances, tea on the shores of scenic West Lake and a tour of Zhejiang University, a leading center of research and innovation, where Cook announced a $4.1 million donation to bolster coding instruction at the institution. It wasn't only American companies being feted, however. Beijing has also stepped up outreach to businesses from Europe and Asia in hopes that firms will be more interested in relying on the Chinese market as a bulwark against Trump's unpredictability. There are early signs that China's efforts to boost outside confidence in its economy are paying off, helped by excitement around technology firms like DeepSeek. That comes after foreign direct investment fell a record 27 percent in 2024 compared with the year before. Interest in Chinese stocks among European and Asia-Pacific investors has improved significantly, while concerns have fallen to the lowest levels in nearly two years, Lei Meng, an analyst at investment bank UBS, said in a note this week. 'This time, there were more Saudi and European companies, and they were more active to hedge against the risks of Trump 2.0,' said Wang Yiwei, an international relations scholar at Renmin University in Beijing. 'Now, China is a sharp contrast to the United States,' Wang said. 'If America isn't bright, the Global South will be. If the West isn't bright, China will be.'
