Semafor World Economy Summit: Policymakers and business leaders discuss Trump, AI, and China

EU Trade Commissioner Valdis Dombrovskis

On Donald Trump: “There are elements that make us worried,” based on Trump’s “past statements and track record,” including his position on Ukraine and his history of launching “several trade conflicts.”

On the EU’s relationship with China: “It’s a very complex relationship. We, in some elements, see China as a cooperation partner, in some it’s an economic competitor. In some, it’s also a strategic rival.”

He said of the most important elements shaping the EU’s views of Beijing is “China’s positioning concerning Russia’s war against Ukraine,” adding that China is providing [dual use] components and other elements to Moscow to help sustain its war against Ukraine.

On Chinese competition and the EU’s anti-subsidy probe:
“We are open to the competition from abroad. But this competition must be fair.”

Germany Finance Minister Christian Lindner
On months of slow economic growth in the country: “Given the circumstances, I think we have shown resilience.” He said the German economy is facing a “hangover,” and needs to mobilize its labor market and reduce bureaucratic red tape.“ He blamed the European Commission, saying, “Much of the red tape is not introduced by the federal German government but by the European Commission.”

On federal monetary policy: “Some think the Inflation Reduction Act of the U. S. could be an example for Germany. But I will be very polite … if we look at the economic development in the U.S., the inflation rate is higher again. And this causes the Fed to react.”
“Why do you dream of an Inflation Reduction Act in Germany when the Inflation Reduction Act of the U. S fails to reduce the inflation?”

On building Europe’s military and defense strength:
“The nuclear components of European NATO members have to be taken into consideration.”

On what Europe should do with seized Russian assets: “We should not harm the idea of state immunity because the negative side effects are not foreseeable.” Lindner said the EU is taking steps to allow “the revenues out of these assets to be used to support Ukraine, and this is the next step we’re about to introduce.”

Microsoft CTO Kevin Scott

On the limits of scaling AI models: “At some point models won’t improve with scaling,” adding that eventually there will be no point to continue continue putting more computing power towards training larger systems.

Cybersecurity and Infrastructure Security Agency Executive Director Brandon Wales
On Chinese hacking: China is using hacking to burrow into critical U.S. infrastructure, learn the infrastructure, and prepare for future attack and cause “societal panic” inside the U.S. “The sky is the limit” when it comes to Chinese hacking intentions and capabilities.

USAID Deputy Assistant Administrator Mark Simakovsky
On criticism about funding Ukraine: “There is no blank check for Ukraine, and there also is no blinding support that isn’t seeking to create the ability for Ukraine to stand up on its own two feet.”

On attracting foreign investment in Ukraine: “Reform is critical” in order to get more foreign investment. He said that while some changes have been made to address the country’s corruption issues, “more is needed.”

Republican Rep. Kevin Hern

On competition with China: “I think it’s healthy to have competition... I look at China as being a very strong competitor, especially since we gave them access to the WTO.”

“But it’s not going quite the way that everybody thought it would. And you know you can’t blame them. They wanted to be a strong competitor, and they have done so.”

On the future of the U.S.-China relationship: “We don’t want to decouple. I don’t hate China, I just love America. … We need the Chinese economy and they need ours.”

On House Speaker Mike Johnson: “Even though you may have the majority in the House, we haven’t done a real good job as members of Congress, House representatives, to lever that power. … And we have to take that power and do something with it. Trust me. Speaker Pelosi did twice and she was unabashedly open about it. She didn’t really care what the Senate did, Republican or Democrat, or the White House.”
“So we need to use that same sort of moxie... Nobody will ever say that Speaker Pelosi was ever a weak leader. We didn’t like her politics but she ruled with a strong fist, and we need to do the same thing in the Republican Party.”

On Mike Johnson separating Ukraine and Israel funding bills: “It was the right thing to do.” He also hinted that Republicans may still try to include border security provisions in any Ukraine deal.

Constellation Energy CEO Joe Dominguez

On nuclear energy powering AI data centers: “Data centers and nuclear plants go together like peanut butter and jelly,” he said.

On Trump’s take of nuclear policy in renewables:“He was right in saying that the nation was putting too many eggs in the basket of intermittent resources to run a power grid.”

On concerns about AI energy use:
“We probably ought to put a pin in this one for a bit of a year and kind of see how this fleshes out,” he said, adding that energy providers did not “accurately” predict consumer demand for new technologies and many now have a surplus of energy.

Dell Technologies CTO John Roese
On slow AI regulation: Unlike tech like 4G and 5G — which have several years in between generations, allowing lawmakers to better adapt policy —AI innovation is so rapid that government can’t catch up, Roese said. “It’s not just because it’s different technology: It’s the speed in which it’s happening.”

White House Council of Economic Advisors chair Jared Bernstein:
On German finance minister’s criticism of the Inflation Reduction Act: “It should be obvious to anyone that the IRA is about a lot more along with inflation reduction,” particularly in funding green technology. He said it was more accurate to call it the “dis-inflation act” as it focuses more on reducing costs for things like drugs.

On U.S. semiconductor sector: Bernstein said that the chip industry should not just train more workers, but include benefits like childcare for employees. “Not only does that help with a more diverse workforce, it gives women more of a chance to come into the field, which we think is so important,” he said.

U.S. Chamber of Commerce CEO Suzanne P. Clarke

On what foreign leaders ask her: She said that heads of state are often “confused” because “they don’t understand America’s retreat on trade, America’s retreat from foreign markets and from the foreign stage, and they’re scared of it.”

On the U.S. retreat from free trade: “In the last decade, the United States hasn’t signed a single new trade agreement when the rest of the world has rushed to sign — I don’t know — more than 100. That’s our companies being left behind.”

“It’s embarrassing to go to Japan and have the prime minister and other people say to me you kind of forced us into the TPP, and we didn’t really want to be there. And then you walked away. … It’s embarrassing.”

Nigeria Finance Minister Wale Edun
On boosting revenue in Nigeria: “The lowest hanging fruit for Nigeria right now is to bump up oil production” to the highest levels allowed under international climate change agreements.

CEO of Willett Advisors Steve Rattner
On the global semiconductor market: “This is another problem from hell. 92% of all the world’s high-end semiconductors are produced in Taiwan. This is an existential risk to us. It’s like oil in 1973.” The chances of the U.S. “actually replicating what they have are approximately zero for a whole lot of reasons.”

GE Vernova CEO Scott Strazik
On the Inflation Reduction Act: The IRA is “transformative for a number of our businesses, including for wind, and we’re certainly investing to fulfill on being able to serve the U.S. onshore wind industry with local content, and that’s because of the Inflation Reduction Act.”

“At the same time when I’m in D.C., … the conversations focus on jobs. In reality, [the IRA is] adding jobs.”

Google DeepMind General Counsel Tom Lue
On how AI can benefit society: The Apollo program “signaled a national commitment to a very bold and ambitious mission.” The mentality of pursuing moonshot science should be applied to AI too, he argued. “There’s a role for governments and private sectors to set bold research agendas in AI for climate, AI for health.”

Intel CEO Pat Gelsinger
On whether Intel will be able to beat TSMC at chips: “Yes, we have laid out a course to rebuild technology leadership, rebuild manufacturing capabilities, and become a foundry. We design almost 50% of the world’s semiconductors.”

On Intel’s new Gaudi 3 AI accelerator chip:
“This would be called the best AI PC chip available today. ... All of your PCs in the future should become AI-enabled. Instead of typing on the 1886 QWERTY keyboard, you’ll start talking to your PC using AI accelerators.”

U.S. Deputy Secretary of the Treasury Wally Adeyemo
On how Russian assets can be used to help Ukraine: “We’re working through with our G7 allies and our partners a number of options as to how we can do that, with the hope being that in addition to getting the supplemental done in Congress, we’re in a place where we can demonstrate to Ukraine that they’re going to have access to additional resources in the years to come.”

On the difference between Biden and Trump’s economic policy: “I think the difference between President Biden and the previous administration is that while we’re going to act in our economic interest — we’re going to put tariffs on steel where we see overcapacity — […] we’re also going to do that with our allies and partners, not to our allies and partners.”

North Carolina Gov. Roy Cooper
On 2024 U.S. election: “People got to see the first Trump presidency, and they don’t want to see another one. I believe President Biden can win North Carolina.”

U.S. Commerce Secretary Gina Raimondo
On de-linking from China: “We don’t want to delink ourselves economically,” she said. “That would be a bad thing. ... Even from China. We sell billions of dollars a year of semiconductor chips to China.” But in terms of protecting U.S. national security, she said, “If it’s our crown jewels, our most sophisticated AI, most sophisticated chips, most sophisticated chip equipment? No, that is national security I don’t care how much revenue you have to give up, you’re not allowed to sell that to China.”

On protectionism: “I worry deeply, actually, about countries’ instincts to draw within... Half of the world is voting in an election, which always brings out people’s protectionist tendencies. Of course I worry about that.”

Hyundai President and Global COO Jose Muñoz
On Hyundai’s competition with Elon Musk’s Tesla: “I think we talk less and do more,” Muñoz said. Hyundai is the second largest company in terms of EV sales after Tesla, and are “closing the gap step by step,” Muñoz said, although he admitted that “it is tough” to compete with Elon Musk’s company.

U.S. Transportation Secretary Pete Buttigieg

On DOT watchdog auditing FAA’s oversight of Boeing: “It’s very healthy for the [DOT’s Inspector General] to be constantly auditing everything that happens across the DOT,” Buttigieg said. “Obviously, when something is in the news, they’re going to take a closer look the same way we’re taking a closer look at Boeing.”

UK Chancellor of the Exchequer Jeremy Hunt

On Brexit consequences: Hunt, who voted against Brexit, said it wasn’t possible to argue that”the UK has suffered irreversible damage.”
“There’s absolutely no reason why, with an economy the size of the UK, we can’t be successful as a fully independent country like Canada or Australia or Japan or South Korea.”

On the UK’s battle with inflation: “We’ve pretty much had a soft landing,” Hunt said, as UK inflation fell to 3.2% on Wednesday. Eighteen months ago “the UK was forecast to have the longest recession in 100 years.”

On what to do with Russia’s frozen assets:
“It’s very tempting when you have these Russian assets to say we should just grab them; look at what Putin’s done. But we should remember that the argument we’re trying to win is that the law should count.”

On European countries’ defense spending to support Ukraine: Hunt said that while it was “great” that U.S. House Speaker Mike Johnson was going to put forward a Ukraine aid bill, it was challenging to convince the U.S. to spend more on Europe’s defense “ is because people worry that Europe isn’t playing its part.” He said that one of the biggest challenges facing UK — which has Europe’s biggest defense budget — “is to persuade other European countries to hit that NATO 2%.” If all NATO members in Europe spent 2% of their GDP on defense, Hunt said, that would mean an additional $77 billion spent annually on defense in Europe. “There could not be a better or bigger signal to Putin that we will never let Ukraine lose.”

Mexico Secretary of Finance Rogelio Ramírez de la O

On Chinese investments in Mexico: Ramírez did not elaborate on whether Mexico had concerns about Chines investments — particularly in electric vehicle manufacturing. He only said that Mexico would be “respectful” about trade rules set up with the U.S.

“We are mostly committed to North American integration to the extent that North American integration rules permit foreign direct investment from anywhere else,” he said.

On possible trade tensions after the 2024 U.S. presidential election:

“We already know and have been partners with a Republican government. We keep being good trade partners with a Democratic government, including the requests by the labor unions and we will continue to navigate and confront in good spirit these situations.….It’s not going to take us by surprise.”

On U.S. border efforts to curb illegal immigration

Ramírez said he only expects “good will” from Washington in terms of helping curb illegal immigration. “What Mexico wants for most is permanent dialogue,” he said.

Chair of the Regional Leadership Council and Maryland’s Democratic Rep. Steny Hoyer

On House Speaker Mike Johnson putting forward a Republican bill for more Ukraine aid: “I’m going to say Speaker Johnson did the right thing. He did it a little late, but he did the right thing. We did the right thing, and we’re getting money to Ukraine…I think we should have done it months ago, but we’ve done it now, and hopefully it’s not too late to do the right thing.”

Hoyer would not say if he would vote to keep the speaker in place if a motion to vacate is brought, but said: “We need to bring some stability.”

On Israel pledging a response to the Iranian attack: Hoyer said he was concerned that any escalation in the Middle East could spill over and involve the U.S. and other nations, like during Iran’s drone attack on Israel. He said Israel will decide how to response to the attack keeping in mind that other nations will respond to being attacked. 

On whether Israeli Prime Minister Benjamin Netanyahu should step down: Hoyer said that was a question for the Israeli people, but said that Netanyahu had a created a “questionable coalition” facing a similar problem that U.S. Republicans have: “They have a very hard right who will not compromise, they won’t compromise with their own leadership… They have a destabilizing impact on the country.”

On Biden economy criticism: Hoyer said that Americans buying food and gas are getting mixed messages that “this economy is really good, but inflation continues to grip us.”

“People say ‘Oh, you give me these statistics and well, that’s great, the GDP is great, but… the eggs that I’m buying are much more expensive than last week,’” he said. Because of this “people who ought to know better are saying this economy is terrible, the Biden economy is terrible — that’s baloney.”

Shell USA President Gretchen Watkins

On Middle East conflict impact: Watkins said there isn’t a significant disruption to energy supply directly linked to the Middle East conflict currently, but energy providers and governments should be prepared for the future: “We’re going to continue to have [disruptions], so we need to be ready for them.”

On electric vehicles: “We’re actually really excited about EVs,” Watkins said, adding that Shell has become one of the largest installers of EV infrastructure across the globe. She said that she doesn’t see EVs as a threat but an “opportunity.”

Former U.S. Treasury Secretary Larry Summers

On inflation under a Trump presidency: Summers said that a Trump presidency “would set off an inflationary spiral.”

“I think it would be massive regulation in the form of restrictions on the ability to buy products from abroad, which would raise prices, and lead to inflationary spiral.”

On Federal interest rates: “I think it’s probably still the case that the market and the Fed are overestimating how much room there is to cut interest rates,” Summers said, pointing to strong energy investment.

Electric aerospace company BETA COO Blain Newton

On the benefits of electrifying the aviation industry: “We’re on a mission to decarbonize aviation and frankly we think the market exists right now in medical — moving organs around — […] and then moving cargo.” He added that the real benefit was the lower operating costs: “You effectively render the fuel cost irrelevant and you drive down maintenance costs exponentially.”

White House National Climate Advisor Ali Zaidi
On how the Biden administration could protect the US EV industry from China’s trade practices: “There are a number of trade tools that are appropriate there. Tariffs are, I think, one part of a robust trade posture that the U.S. and frankly, our allies and partners need to be pursuing effectively.”