KraneShares’ Visit Finds China “Open for Business” | ETF Trends

Representatives from KraneShares recently visited China for the first time since the onset of the pandemic. The robust activity they found signals that China is an economy on the mend as business recovers, despite macro challenges.

Xiabing Su, cultural analyist at KraneShares, met with members of KraneShares in their first visit to China since 2020. CEO Jonathan Krane; Terry Branstad, former U.S. ambassador to China; and David Adelman, general counsel for KraneShares and former ambassador to Singapore; joined Xiabing and reflected on their visit in a recent video.

Visiting China allowed Krane to see exactly “how busy China is, and it feels… fully back to work.” Adelman echoed the sentiment, remarking on the robust activity in Beijing and Shanghai. The cities and China itself appear “very much open for business,” according to Adelman.

See more: “Is China a Bargain Bin Buy?

U.S. and China Relations Remain Sticking Point for Investors

It’s been a constrained several years between the U.S. and China on a number of fronts. Political tensions and risk led many foreign investors to minimize their China exposure in the last few years. Many institutional investors remain underweight to China and continue to sit on the sidelines this year.

There is potential thawing between the two governments, however. Secretary of State Antony Blinken’s recent visit to the Mainland remains significant and resulted in a net-positive sentiment. It’s the first time in five years that a U.S. diplomat traveled to China, and Chinese officials committed to a reverse trip later this year.

Despite overlying tensions, the two countries remain economically entangled. This gives KraneShares hope that the two governments will find a path forward.

“I’m very optimistic about U.S.-China relations, primarily because the two countries are interdependent,” Adelman told Xiabing. “China has an interest in America’s economic success, American purchasing power.”

On the flip side of that, the U.S. remains tied to China for the export of products the country provides. Adelman also noted the growing demand and market for American products in China.

KraneShares offers a number of China-focused ETFs for investors looking for exposure to a potential recovery. Funds include the KraneShares CSI China Internet ETF (KWEB), the KraneShares Bosera MSCI China A Share ETF (KBA), and the KraneShares CICC China Consumer Leaders Index ETF (KBUY).

For more news, information, and analysis, visit the China Insights Channel.