Wall Street CEOs Silent on China Tensions in Visit to Hong Kong

When several of Wall Street's most influential executives visited Hong Kong on Tuesday they discussed a series of issues but largely ignored the elephant in the room — China.

Roughly 300 business executives — including Goldman Sach's David Solomon and Apollo Global Management's Marc Rowan — were in Hong Kong for the Global Financial Leaders' Investment Summit to speak with local leaders and Chinese officials, Bloomberg reported. While executives voiced their thoughts on topics ranging from financial stability to market trends, most avoided discussing mainland China and the geopolitical tensions looming over the conference.

Relations between the U.S. and China have been strained for years and have only grown worse in recent months amid conflicts in Ukraine and the Middle East, restrictions on exports related to semiconductors and Taiwan independence. Additionally, U.S. companies have grown increasingly wary of operating in Hong Kong after Beijing raided several foreign firms and blocked executives from leaving mainland China.

John Lee, the chief executive of Hong Kong, said the city would continue to act as a gateway between mainland China and global markets. But he also acknowledged the geopolitical risks threatening its status.

“Geopolitical risks continue to proliferate, squeezing international trade and complicating global supply chains," Lee said in a speech during the conference. "Hong Kong, a free and open economy, is hardly immune to global economic headwinds."

As China's economy slows down, investment banks have earned just $539 million in fees this year from deals involving companies from China in currencies other than Yuan, The Wall Street Journal reported. In 2020, when initial public offerings were hot commodities and many Chinese companies issued U.S. dollar bonds, those banks collected about $3.75 billion, according to the Journal.

“The big discussion — I think maybe not officially, but obviously in private discussions — is going to be the Chinese-U.S. freeze and what does that really mean for growth prospects and general opportunities for these banks,” Mark Williams, a specialist in capital markets and risk management at Boston University, told the Journal.

While most of the discussions at the conference avoided questions related to mainland China, some executives did briefly speak about the country. Citadel founder and CEO Ken Griffin complimented the strength of management teams in China and said the country is a leader in areas such as solar energy and electric vehicles.

"There's much more innovation outside of the United States relevant to 50 years go," Griffin said in response to a question at the event. He added, “If you’re a global investor, you’ve got to be watching and investing here in China."

The summit is just the start of a busy week in Hong Kong. A similar event is scheduled for Wednesday — this time for large investors — and the nonprofit China-United States Exchange Foundation's two-day forum on relations between the two nations will be on Thursday, the Journal reported.