Asian Tech Titans Take a Page From Trump’s Book
The promises from the big Asian business leaders will be tough to keep, experts say. But they show that Asia’s tech titans see a familiar figure in Mr. Trump.
American leaders have largely shied from interfering in individual business decisions, instead relying on competitiveness to keep American companies ahead in a global market. But Mr. Trump’s focus on job protection, tariffs and the dictating of terms to business leaders is closer to the more mercantilist outlook that Mr. Ma, Mr. Son and Mr. Gou see to varying degrees in China, Japan, Taiwan and other places in Asia.
“They see where this guy Trump is coming from, and, at a visceral level, identify with him,” said Alberto Moel, an analyst at Sanford C. Bernstein.
“It plays directly into their style,” he said. “These guys are political animals. They live in Asia, where things are different. There’s more autocracy and more connected transactions. In the U.S., people still expect things to be fair.”
The Asian executives come from a region Mr. Trump accuses of using unfair trade practices and stealing American jobs — and all three have a lot to lose. It is not clear whether their lofty promises will lead to better treatment from the Trump administration.
Alibaba, which has shares that trade in the United States, has been under fire there for the fakes that proliferate on its Chinese sales platforms. It also has an eye toward expanding into places like Hollywood. Mr. Son’s SoftBank owns Sprint, the American telecom company, and has long desired to expand.
Foxconn — a Taiwan-based company with many factories in China — assembles iPhones and other gadgets for Apple, which Mr. Trump has said should make its products in America. Foxconn also has plants in Mexico that benefit under the North American Free Trade Agreement.
A SoftBank spokesman said, “Mr. Son was greatly encouraged by the economic agenda of the new administration, and he intends to invest significant resources in the U.S. in the years ahead.” A Foxconn spokeswoman said that the company was evaluating an investment in America and that it expected a new American project would create “many direct and indirect job opportunities.” An Alibaba spokeswoman declined to comment.
Of course, the United States has a long history of supporting its homegrown industries. Still, East Asian governments often intervene more directly in business, and many of Mr. Trump’s proposals suggest he wants to adopt similar strategies.
In China, government officials give public and financial support to building up industries to make the country less dependent on exports. In Japan, the government is supporting a new effort to build an aerospace industry. In South Korea, the government has lavished subsidies and tax breaks on its largest exporters, like Hyundai and Samsung.
Even Mr. Trump’s public praise and cajoling, including the photo ops in Trump Tower and the Twitter posts broadcasting investment vows as political victories, have an East Asian feel.
“In Japan and China you need to go through these rituals,” said Willy Shih, a professor at Harvard Business School. “You could argue that looking at Mr. Trump, they’re saying, ‘O.K., I have to figure out what the ritual is and go through it,’ and these guys know how to do that stuff.”
The first to pay homage to Mr. Trump was Mr. Son, who in a meeting late last year vowed a $50 billion investment that he said would create 50,000 jobs.
Then in January, Mr. Ma of Alibaba assured Mr. Trump that small businesses selling goods on his websites in China would add a million new American jobs. More recently, Mr. Gou of Foxconn said at a news conference that Foxconn was considering a $7 billion investment in a flat-panel production facility in Pennsylvania that could create up to 50,000 jobs.
In all three cases, the Asian companies appear to have fostered good will.
After meeting with Mr. Ma, Mr. Trump said that the Alibaba founder loved America and China and that the two of them would “do some great things.”
It is not clear how many of the pledges will come to pass.
Mr. Gou has cautioned that the Pennsylvania plant is more a wish than a promise. Putting a flat-panel production center in Pennsylvania places it far from the electronics supply chain that crisscrosses Asia. There is also less experience in building such factories in the United States, and regulatory risks could threaten to turn a multibillion-dollar investment into a big money loser if there are delays in opening it.
“They’re making these promises that I wouldn’t say they have no intention of keeping, but they’re less a promise than an aspiration,” Mr. Moel said. “If they have to they’ll do it, but they’d rather not.”
All three of the tech leaders are consummate showmen and self-promoters. Mr. Ma says he would like Alibaba to span three centuries by sticking around for at least 102 years. In a recent investor letter he said that in the next 20 years the company would create 100 million jobs. Mr. Son has a 300-year plan for SoftBank, and he often follows up big deals with big promises.
In places like China, Mr. Gou has used the lure of a huge factory to extract major tax breaks. But in other countries, such as Indonesia, long talks about building a plant failed to bear fruit.
Still, their tactics could work with a president who has said he wants to emulate East Asian tactics even as he fights them over jobs.
“We got to bring back the jobs from China, we got to bring back the jobs from Japan, and all these countries that are ripping us off,” he said at one campaign event. But he added, “I don’t hold it against these other countries. I mean, if they can get away with it, let them do it. I want to get away with things.”
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