China Could Win Big From Trump's Border Rules

(Bloomberg Gadfly) -- To understand the risk to corporate America from the new U.S. administration's border policies, listen in on a conversation being held on the other side of the world.

The election of President Donald Trump gives China an opportunity to attract global talent, Baidu Inc. Chief Executive Officer Robin Li said during a panel of the Chinese People's Political Consultative Conference in Beijing on Monday.

That the boss of one of China's biggest technology companies not only recognizes the moment, but is willing to speak openly about it, indicates that this is a widely acknowledged opportunity. It also underlines the risk to the U.S. of any restraint on the free flow of personnel. 

Corporations hate uncertainty more than the devils they know, like costs or regulations. The Trump administration's clarification and watering down this week of a directive on travelers from specific countries helps lower, but doesn't eliminate, the ambiguity for companies and their staff -- and was almost simultaneously coupled with suspension of the premium processing of H-1B visa applications.

I know of at least two cases where engineers for one of the largest U.S. technology companies had to be "parked" offshore to work while awaiting their H1-B, the designation given to non-immigrant specialty occupation work visas

China's government, meanwhile, knows that recruiting the world's top talent is key to developing better homegrown technology, and even has a State Administration of Foreign Expert Affairs that drafts strategy, coordinates rules for hiring overseas experts and holds an annual conference to discuss ways to attract top talent.

As part of his discussion, Baidu's Li urged China to do even more to provide a better pathway to work and residency permits. His Beijing-based search engine provider also has an artificial intelligence lab in Silicon Valley, where it's hired some of the world's smartest people in deep learning and big data. Doubtless the Chinese government would like to see more of those people working in Beijing.

Consider the impact on the U.S. if global leaders such as Apple Inc., Microsoft Corp. and Qualcomm Inc. -- which all have research and development centers in China -- decided to place more of the world's brightest minds in Shenzhen, Tokyo or Taipei instead of San Francisco or Seattle. Foreign countries are big winners when their own citizens work alongside and acquire knowledge from global leaders, while the U.S. wouldn't even collect income taxes on salaries paid to non-Americans by its own companies.

In his address to Congress last week, Trump reiterated his call that for every new regulation introduced, two others should be eliminated. When the CEO of a foreign company starts talking about the opportunities afforded by tighter U.S. regulations, you wonder who's really going to benefit.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

Tim Culpan is a technology columnist for Bloomberg Gadfly. He previously covered technology for Bloomberg News.

To contact the author of this story: Tim Culpan in Taipei at tculpan1@bloomberg.net.

To contact the editor responsible for this story: Paul Sillitoe at psillitoe@bloomberg.net.