U.S.-China Trade Resolution Expected Soon, GE’s Culp Says
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U.S.-China relations will continue to evolve as negotiations between the two countries stretch over decades, but a resolution to the current trade dispute will likely happen in the “not too distant future,” General Electric Co.’s Chief Executive Officer Larry Culp said.
His comments came as Treasury Secretary Steven Mnuchin said the U.S. is open to facing “repercussions” if it doesn’t live up to its commitments in a potential trade deal with China, a sign that the two sides are edging closer to an accord to end their nine-month trade and tariff war.
“There’s a politically expedient resolution relative to trade numbers, a big order here, a big order there,” Culp said at the Harvard College China Forum. “Substantively, our sense is that both governments should like to advance the conversation, maybe not once and for all, but in a meaningful way with respect to access and intellectual property.”
He’s also concerned that pulling back from China, where GE started doing business as early as 1906, would open up a void that its competitors in Japan and Europe would be “very quick” to fill. China is GE’s biggest market by revenue after the U.S., he said.
“If you look at our supply chains, the way our design footprints, operate today they are very much integrated global networks,” Culp said. “To pull a piece of the puzzle like China out would impair those supply chains and those design networks.”
The U.S. and China are discussing whether to hold more in-person meetings. The IMF cited trade tensions as a risk in the past week as it cut its outlook for global growth to the lowest since the financial crisis a decade ago.
Culp, highly respected on Wall Street for a successful transformation of Danaher Corp., took over as GE’s CEO in October after John Flannery was ousted, pledging to speed up the company’s turnaround.