China remains ‘hugely important’ to the global economy, says Standard Life Aberdeen chairman

China remains ‘hugely important’ to the global economy, says Standard Life Aberdeen chairman

The importance of China’s role in the world economy has not diminished despite rising geopolitical tensions, said Douglas Flint, chairman of Standard Life Aberdeen.

“I think China is hugely important to the global economy and to global trade,” said Flint, who spoke to CNBC’s Nancy Hungerford during this year’s virtual Singapore Summit.

“Seven months ago, every single company in the world virtually saw its growth opportunities in Asia, led by China. I don’t think that’s changed,” he said on Wednesday. A very strong middle class and the desire to consume in a different way will continue to drive the economy, he said.

But Flint acknowledged that geopolitical tensions can present new challenges for companies.

“Business operates under the umbrella of a geopolitical relationship, and when that relationship is tense, it is more difficult for business to operate,” he said. “Having said that, at the business level, our own relationships with our counterparts and clients in China continues to be very strong. It is not impacted at that level, but obviously there’s an overriding political relationship that makes things difficult.”

He also pointed out that there’s a difference between the political rhetoric and actual moves on the ground. 

“There are many elements in the Chinese economy that are continuing to open up, and we’ve seen many of the major U.S. firms — BlackRock, Vanguard, JPMorgan — beginning to expand their operations, even during this period in China,” Flint said.

That shows continued progress toward the integration of the Chinese economy into the global economy that both sides have aspired to, he said.

“But the political rhetoric is somewhat distant from what’s happening on a commercial side. I think we need to try and bring the two back together and, as I said, I think that should be done through engagement.”

CNBC

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