Former U.S. Ambassador to China Max Baucus on Saturday lauded China's can-do spirit and cited the country's rush to online payments as an area where the country was overtaking the United States.
Baucus nevertheless gave an overall upbeat assessment of U.S.-China relations and offered tips about how U.S. companies can succeed in China and how Chinese companies can make U.S. inroads.
Baucus was speaking at an annual LendIt fintech conference held in Shanghai that attracted more than 2,000 participants. Speakers at the two-day event sized up the industry’s growing impact on banking, data collection, regulation and fraud, among other areas. Besides Baucus, notable attendees included blockchain authority Alex Tapscott, Chinese regulators, and leaders from mainland businesses including Alibaba Group-backed Ant Financial.
Baucus, a former Democratic U.S. senator and fiscal expert from Montana who departed as ambassador last year after three years in the job following the election of Republican Donald Trump, said his position as the U.S. top diplomat in Beijing was his “best job ever” and that he was happy to be back in China. “The optimism is contagious,” he said. “I even think that Chinese people are actually more optimistic about their future than Americans are about theirs.”
China’s “development of payment systems, especially fintech, is a good example of this optimism and this energy,” Baucus said. “China is leapfrogging the standard payments systems still used in the United States and other developed countries,” with widespread online payments replacing cash and credit cards, he said.
“Apple Pay is trying to be an accepted mode of payment in the United States but it is catching up very slowly,” he said. “It’s disadvantaged, I think, compared with China and other Asian countries’ emerging payment systems. Why? Because established legacy institutions such as banks and credit card companies, while still useful, will soon be overtaken by the new innovative technology being developed here and in other Asian countries.”
Progress in the industry is significant for individual companies because it reduces government-connected intermediaries and allows people to do business by themselves, he said. U.S. legislation that would expand fintech regulation isn’t imminent, he said.
While upbeat about China’s fintech prospects, Baucus was critical of Chinese practices that make it hard for U.S. companies to expand in the country, a reality that contrasts to the free-trading portrait of the nation painted by China’s leaders at recent international forums such as Davos.
Nevertheless, Baucus said, U.S.-China relations are “solid,” based in part on the trade, investment and travel between the two countries. He encouraged Americans looking to do business in China to visit the country, and vice-versa for Chinese companies looking to do U.S. business.
--Follow me on Twitter @rflannerychina
