Former AIG patriarch and now head of the Starr Companies, Hank Greenberg, has called on China to reform its protectionist stance to overseas trade and investment arguing that it is the country’s own “interest to reform”.
“In government policies, in regulatory procedures laden with obstacles and delays, in structural impediments such as turnover in government agencies resulting from forced early retirements, and in the mindset of Chinese officials,” the 93-year-old said listing the areas the alleged discrimination can be found.
“This all needs to change,” Greenberg insisted in a letter to the Wall Street Journal calling for the country’s leaders to remove protectionist trade barriers.
Greenberg’s intervention is significant because CV Starr’s roots are in China - founder Cornelius Starr founded the insurance empire, which gave rise to AIG, in Shanghai in 1919 - and Greenberg is widely respected in the country.
“China cannot expect to continue receiving favorable trade and investment terms in foreign markets when it is unwilling to reciprocate,” he wrote.
“It is in China’s interest to reform, and the US is right to press to level the playing field,” he said alluding to the tariffs President Donald Trump has slapped on imports from the country.
He said China, which is the world’s second-largest economy, no longer needed the same accommodations that it needed in its initial stages of development after the country opened up in the 1970s.
“As an emerging market, China erected trade barriers to build its nascent industries,” Greenberg explained.
“This was acceptable to foreign countries like the US for strategic reasons,” he said, adding: “Foreign companies endured it because of China’s vast potential.”
But now, he argued: “It makes sense to reassess the terms of bilateral trade and make them more fair and equitable, with each trading partner securing equal and unhindered market access across all sectors.”
In the opinion piece, entitled “some friendly advice for China’s leaders; you can’t expect to keep receiving favorable trade and investment terms unless you reciprocate”, Greenberg said the ongoing battle of wills between the two countries “is about more than trade”.
“I hope American and Chinese leaders recognize the critical importance of maintaining a constructive and open relationship,” he argued, adding: “It should not be viewed as a zero-sum game.”
“Increased and mutually beneficial bilateral cooperation should be pursued in earnest.”
“That would be a stabilizing force, capable of nurturing both peace and prosperity, while providing a much needed source of comfort to countless people in an increasingly uncertain world,” he concluded.