Tensions between the world’s two largest economies have escalated over the last several years.
Florence Lo | Reuters
BEIJING — China is trying yet again to boost foreign investment, amid geopolitical tensions and businesses’ calls for more concrete actions.
On Feb. 19, authorities published a “2025 action plan for stabilizing foreign investment” to make it easier for foreign capital to invest in domestic telecommunication and biotechnology industries, according to a CNBC translation of the Chinese.
The document called for clearer standards in government procurement — a major issue for foreign businesses in China — and for the development of a plan to gradually allow foreign investment in the education and culture sectors.
“We are looking forward to see this implemented in a manner that delivers tangible benefits for our members,” Jens Eskelund, president of the European Union Chamber of Commerce in China, said in a statement Thursday.
The chamber pointed out that China has already mentioned plans to open up telecommunications, health care, education and culture to foreign investment. Greater clarity on public procurement requirements is a “notable positive,” the chamber said, noting that “if fully implemented,” it could benefit foreign companies that have invested heavily to localize their production in China.
China’s latest action plan was released around the same time the Commerce Ministry disclosed that foreign direct investment in January fell by 13.4% to 97.59 billion yuan ($13.46 billion). That was after FDI plunged by 27.1% in 2024 and dropped by 8% in 2023, after at least eight straight years of annual growth, according to official data available through Wind Information.
All regions should “ensure that all the measures are implemented in 2025, and effectively boost foreign investment confidence,” the plan said. The Ministry of Commerce and National Development and Reform Commission — the economic planning agency — jointly released the action plan through the government’s executive body, the State Council.
Officials from the Commerce Ministry emphasized in a press conference Thursday that the action plan would be implemented by the end of 2025, and that details on subsequent supportive measures would come soon.
“We appreciate the Chinese government’s recognition of the vital role foreign companies play in the economy,” Michael Hart, president of the American Chamber of Commerce in China, said in a statement. “We look forward to further discussions on the key challenges our members face and the steps needed to ensure a more level playing field for market access.”
AmCham China’s latest survey of members, released last month, found that a record share are considering or have started diversifying manufacturing or sourcing away from China. The prior year’s survey had found members were finding it harder to make money in China than before the Covid-19 pandemic.
Consumer spending in China has remained lackluster since the pandemic, with retail sales only growing by the low single digits in recent months. Tensions with the U.S. have meanwhile escalated as the White House has restricted Chinese access to advanced technology and levied tariffs on Chinese goods.
‘A very strong signal’
While many aspects of the action plan were publicly mentioned last year, some points — such as allowing foreign companies to buy local equity stakes using domestic loans — are relatively new, said Xiaojia Sun, Beijing-based partner at JunHe Law.
She also highlighted the plan’s call to support foreign investors’ ability to participate in mergers and acquisitions in China, and noted it potentially benefits overseas listings. Sun’s practice covers corporates, mergers and acquisitions and capital markets.
The bigger question remains China’s resolve to act on the plan.
“This action plan is a very strong signal,” Sun said in Mandarin, translated by CNBC. She said she expects Beijing to follow through with implementation, and noted that its release was similar to a rare, high-profile meeting earlier in the week of Chinese President Xi Jinping and entrepreneurs.
That gathering on Feb. 17 included Alibaba founder Jack Ma and DeepSeek’s Liang Wenfeng. In recent years, regulatory crackdowns and uncertainty about future growth had dampened business confidence and foreign investor sentiment.
China needs to strike a balance between tariff retaliation and stabilizing FDI, Citi analysts pointed out earlier this month.
“We believe China policymakers are likely cautious about targeting U.S. [multinationals] as a form of retaliation against U.S. tariffs,” the analysts said. “FDI comes into China, bringing technology and know-how, creating jobs, revenue and profit, and contributing to tax revenue.”
In a relatively rare acknowledgement, Chinese Commerce Ministry officials on Thursday noted the impact of geopolitical tensions on foreign investment, including some companies’ decision to diversify away from China. They also pointed out that foreign-invested firms contribute to nearly 7% of employment and around 14% of taxes in the country.
Previously, official commentary from the Commerce Ministry about any drop in FDI tended to focus only on how most foreign businesses remained optimistic about long-term prospects in China.
Leading analyst Craig Moffett suggests any plans to move U.S. iPhone assembly to India is unrealistic.
Moffett, ranked as a top analyst multiple times by Institutional Investor, sent a memo to clients on Friday after the Financial Times reported Apple was aiming to shift production toward India from China by the end of next year.
He’s questioning how a move could bring down costs tied to tariffs because the iPhone components would still be made in China.
“You have a tremendous menu of problems created by tariffs, and moving to India doesn’t solve all the problems. Now granted, it helps to some degree,” the MoffettNathanson partner and senior managing director told CNBC’s “Fast Money” on Friday. “I would question how that’s going to work.”
Moffett contends it’s not so easy to diversify to India — telling clients Apple’s supply chain would still be anchored in China and would likely face resistance.
“The bottom line is a global trade war is a two-front battle, impacting costs and sales. Moving assembly to India might (and we emphasize might) help with the former. The latter may ultimately be the bigger issue,” he wrote to clients.
Moffett cut his Apple price target on Monday to $141 from $184 a share. It implies a 33% drop from Friday’s close. The price target is also the Street low, according to FactSet.
“I don’t think of myself as the biggest Apple bear,” he said. “I think quite highly of Apple. My concern about Apple has been the valuation more than the company.”
Moffett has had a “sell” rating on Apple since Jan. 7. Since then, the company’s shares are down about 14%.
“None of this is because Apple is a bad company. They still have a great balance sheet [and] a great consumer franchise,” he said. “It’s just the reality of there are no good answers when you are a product company, and your products are going to be significantly tariffed, and you’re heading into a market that is likely to have at least some deceleration in consumer demand because of the macro economy.”
Moffett notes Apple also isn’t getting help from its carriers to cushion the blow of tariffs.
“You also have the demand destruction that’s created by potentially higher prices. Remember, you had AT&T, Verizon and T. Mobile all this week come out and say we’re not going to underwrite the additional cost of tariff [on] handsets,” he added. “The consumer is going to have to pay for that. So, you’re going to have some demand destruction that’s going to show up in even longer holding periods and slower upgrade rates — all of which probably trims estimates next year’s consensus.”
According to Moffett, the backlash against Apple in China over U.S. tariffs will also hurt iPhone sales.
“It’s a very real problem,” Moffett said. “Volumes are really going to the Huaweis and the Vivos and the local competitors in China rather than to Apple.”
Apple stock is coming off a winning week — up more than 6%. It comes ahead of the iPhone maker’s quarterly earnings report due next Thursday after the market close.
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In a year that hasn’t been kind to many big-name stocks, Warren Buffett’s Berkshire Hathaway is standing near the top. Berkshire shares have posted a 17% return year-to-date, while the S&P 500 index is down 6%.
That performance places Berkshire among the top 10% of the U.S. market’s large-cap leaders, and the run has been getting Buffett more attention ahead of next weekend’s annual Berkshire Hathaway shareholder meeting in Omaha, Nebraska. It’s also good timing for the recently launched VistaShares Target 15 Berkshire Select Income ETF(OMAH), which holds the top 20 most heavily weighted stocks in Berkshire Hathaway, as well as shares of Berkshire Hathaway.
“It’s a really well-balanced portfolio chosen by the most successful investor the world has ever seen,” Adam Patti, CEO of VistaShares, said in an appearance this week on CNBC’s “ETF Edge.”
Berkshire’s outperformance of the S&P 500 isn’t limited to 2025. Buffett’s stock has tripled the performance of the market over the past year, and its 185% return over the past five years is more than double the performance of the S&P 500.
Berkshire Hathaway is one of 2025’s top performing stocks.
In addition to this long-term track record of success in the market, Berkshire Hathaway is getting a lot of attention right now for the record amount of cash Buffett is holding as he trimmed stakes in big stocks including Apple, which has proven to be a great strategy. The S&P 500 has experienced extreme short-term volatility since President Donald Trump’s inauguration on January 20. Even after a recent recovery, the S&P is still down 8% since the start of Trump’s second term.
“The market has been momentum driven for many years, the switch has flipped and we’re looking at quality in terms of exposure, and Berkshire Hathaway has performed incredibly well this year, handily outperforming the S&P 500,” said Patti.
Berkshire Hathaway famously doesn’t pay a dividend, with Buffett holding firm over many decades in the belief that he can re-invest cash to create more value for shareholders. In a letter to shareholders in February, Buffett wrote that Berkshire shareholders “can rest assured that we will forever deploy a substantial majority of their money in equities — mostly American equities.”
The lack of a dividend payment has been an issue over the years for some shareholders at Berkshire who do want income from the market, according to Patti, who added that his firm conducted research among investors in designing the ETF. “Who doesn’t want to invest like Buffett, but with income?” he said.
So, in addition to being tied to the performance of Berkshire and the stock picks of Buffett, the VistaShares Target 15 Berkshire Select Income ETF is designed to produce income of 15% annually through a strategy of selling call options and distributing monthly payments of 1.25% to shareholders. This income strategy has become more popular in the ETF space, with more asset managers launching funds to capture income opportunities and more investors adopting the approach amid market volatility.
People shop for produce at a Walmart in Rosemead, California, on April 11, 2025.
Frederic J. Brown | Afp | Getty Images
A growing number of Americans are using buy now, pay later loans to buy groceries, and more people are paying those bills late, according to new Lending Tree data released Friday.
The figures are the latest indicator that some consumers are cracking under the pressure of an uncertain economy and are having trouble affording essentials such as groceries as they contend with persistent inflation, high interest rates and concerns around tariffs.
In a survey conducted April 2-3 of 2,000 U.S. consumers ages 18 to 79, around half reported having used buy now, pay later services. Of those consumers, 25% of respondents said they were using BNPL loans to buy groceries, up from 14% in 2024 and 21% in 2023, the firm said.
Meanwhile, 41% of respondents said they made a late payment on a BNPL loan in the past year, up from 34% in the year prior, the survey found.
Lending Tree’s chief consumer finance analyst, Matt Schulz, said that of those respondents who said they paid a BNPL bill late, most said it was by no more than a week or so.
“A lot of people are struggling and looking for ways to extend their budget,” Schulz said. “Inflation is still a problem. Interest rates are still really high. There’s a lot of uncertainty around tariffs and other economic issues, and it’s all going to add up to a lot of people looking for ways to extend their budget however they can.”
“For an awful lot of people, that’s going to mean leaning on buy now, pay later loans, for better or for worse,” he said.
He stopped short of calling the results a recession indicator but said conditions are expected to decline further before they get better.
“I do think it’s going to get worse, at least in the short term,” said Schulz. “I don’t know that there’s a whole lot of reason to expect these numbers to get better in the near term.”
The loans, which allow consumers to split up purchases into several smaller payments, are a popular alternative to credit cards because they often don’t charge interest. But consumers can see high fees if they pay late, and they can run into problems if they stack up multiple loans. In Lending Tree’s survey, 60% of BNPL users said they’ve had multiple loans at once, with nearly a fourth saying they have held three or more at once.
“It’s just really important for people to be cautious when they use these things, because even though they can be a really good interest-free tool to help you kind of make it from one paycheck to the next, there’s also a lot of risk in mismanaging it,” said Schulz. “So people should tread lightly.”
Lending Tree’s findings come after Billboard revealed that about 60% of general admission Coachella attendees funded their concert tickets with buy now, pay later loans, sparking a debate on the state of the economy and how consumers are using debt to keep up their lifestyles. A recent announcement from DoorDash that it would begin accepting BNPL financing from Klarna for food deliveries led to widespread mockery and jokes that Americans were struggling so much that they were now being forced to finance cheeseburgers and burritos.
Over the last few years, consumers have held up relatively well, even in the face of persistent inflation and high interest rates, because the job market was strong and wage growth had kept up with inflation — at least for some workers.
Earlier this year, however, large companies including Walmart and Delta Airlines began warning that the dynamic had begun to shift and they were seeing cracks in demand, which was leading to worse-than-expected sales forecasts.