“China didnt want to discuss Google,” Josef Ackermann, chief executive officer of Deutsche Bank AG and a co-chairman of this years World Economic Forum, said in an interview. Chinas Vice Premier Li Keqiang made that clear, he said. “Google has backed off a little bit.”
Even Google CEO Eric Schmidt didnt bring up China, a market that will account for $600 million of Googles sales this year, according to JPMorgan Chase & Co. Google said this month that it had faced a “highly sophisticated” attack on its systems and that human-rights activists were targeted.
At Davos, participants such as financier George Soros, economist Joseph Stiglitz and French President Nicolas Sarkozy debated technology topics such as social networking and 3-D features used in the motion picture “Avatar.” The discussion didnt include the conflict between China and Google, even in panels such as “The Rise of Asia” or “Redesigning the Global Dimensions of Chinas Growth.”
By leaving China, Google, the most used Internet search engine, would be giving up access to the worlds largest Internet market.
Yesterday, U.S. Secretary of State Hillary Clinton urged the Chinese government to investigate Googles allegations of cyber attacks.
“We cannot afford in todays interconnected world to have too many instances where businesses are constrained, where information is not flowing freely, where companies accounts can be hacked into,” Clinton said in an interview with Bloomberg Radio in Paris, where she met with Sarkozy.
Discuss the Positives
“China just wants people to discuss the positives — the commercial opportunities and how China can be a force for reviving the world economy,” said Christopher McNally, a China specialist at the Honolulu-based East-West Center, a research organization established in 1960 to strengthen relations between Asia and the U.S. “Government and business leaders at Davos, by not addressing this issue that there really is a clash of values on both sides, do risk popular backlashes within their own countries.”
The reluctance of companies to talk about China illustrates the pressure on them to protect their business in the country, while the U.S. government doesnt want to upset Chinese investors, the biggest holders of U.S. debt, said Andy Mok, president of consulting firm Red Pagoda Concepts LLC.
China held $789.6 billion in U.S. Treasuries in November, or 22 percent of debt held by foreign investors, according to Treasury Department data.
Huge Issue
Google, based in Mountain View, California, declined $4.35 to $529.94 yesterday in Nasdaq Stock Market trading. The shares have fallen 15 percent this year.
Adobe Systems Inc., Juniper Networks Inc. and Rackspace Hosting Inc. said after Googles announcement that they were targeted by cyber attacks. Yahoo! Inc. was also among the companies affected by the attack on Google, a person familiar with the matter said this month.
John Davies, general manager of Intel Corp.s World Ahead program, which works with governments to help bring wireless connectivity to disadvantaged communities, declined to discuss Google and China at Davos.
Intel, the worlds biggest chipmaker, is building its first manufacturing plant in China. The country accounted for 13 percent of Santa Clara, California-based Intels sales in its fiscal year 2008, according to Bloomberg data.
Growing Business
“China is going to be a growing business for us,” Sehat Sutardja, CEO of Santa Clara, California-based Marvell Technology Group Ltd., said in an interview in Davos.
Sutardja, whose company supplies the main chip for Research In Motion Ltd.s BlackBerry, said he faces none of the obstacles Google is discussing because Marvell doesnt produce content.