Sen. Schumer meets with China's Xi Jinping on delegation trip

In a meeting today between a congressional delegation and China's leadership in Beijing, Senate Majority Leader Chuck Schumer (D-NY) criticized Chinese President Xi Jinping for failure to condemn Hamas' attacks on Israel.

China Beige Book International Managing Director Shehzad Qazi joins Yahoo Finance to break down Schumer's comments and the political relationship between U.S. and China.

Qazi warns businesses about weighing risk: "Businesses have to get sharp, managing political risk more broadly. They have to get very serious about how they think about risk in China as well as in Washington, D.C."

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Video Transcript

- What about the fact, though, that Xi Jinping did make time for Senator Schumer, met with him, lots of talk about whether or not he's going to be sitting down with President Biden at APAC next month? Does this signal that maybe that meeting is more likely?

SHEHZAD QAZI: I think that is something that the White House is coordinating directly. Quite frankly, the Senator's office doesn't have any remit on setting up that meeting. I think it looks like it's going to go through, and it's part of the current administration's larger effort. They've done a series of high-profile meetings going into China.

Part of this is, of course, China is finally open for business. You can actually travel to China and meet with your counterparts, which is also the reason behind this flurry of activities.

The real question now becomes, what are the topics that can be discussed, and is this just to keep the lines of communication open so that there is no misunderstanding of intentions, which is very, very important, because if we're talking about resolution on certain issues or striking any deals, quite frankly, there's nothing on the table that the two sides today can sit across from each other and discuss.

- Shehzad, how much more difficult does this make any business trying to make sure that there is-- and we've heard this cited multiple times over the course of this year on earnings calls, the amount of international conflict. And back then, it was just Russia Ukraine, which by the way, still goes on in the backdrop. So what type of multiplier does this add on for businesses trying to navigate a fractured international equation?

SHEHZAD QAZI: Yeah, look, I think businesses would tell you that our real concern today isn't what's happening in China, even though, empirically, that's not true. But they're certainly very concerned about policy as it has been formulated in DC. And they're trying to consistently push back, of course, any hardening of policy vis a vis China, whether it's on things like export controls, whether it's potentially new investigations and additional tariffs, and so forth.

But the reality remains that businesses have to get very, very sharp about managing policy risk, about managing political risk more broadly. And they have to get very, very serious about how they think about risk in China, as well as Washington DC, because at times, over the last, I would say at this point, going on to almost eight years, they have been caught off guard, they have been sitting ducks in both countries. And that's been bad for the bottom line, and business as usual is not going to work anymore.