Trump’s potential TikTok joint venture may set standards for Chinese firms in the U.S. He proposes 50% ownership for the U.S. to ensure TikTok’s viability. While exploring partnership models, discussions point to influential figures like Musk as potential collaborators. TikTok’s commitment to cooperate is evident, yet regulatory clarity is vital amid changing trade dynamics.
With Donald Trump resuming the presidency, his proposed idea for a TikTok joint venture could set a new standard for how Chinese companies engage in the United States. Recently, he communicated his vision on Truth Social, stating: “I would like the United States to have a 50% ownership position in a joint venture. By doing this, we save TikTok, keep it in good hands and allow it to [stay] up.”
The next day, Trump enacted an executive order granting TikTok a total of 75 days to seek a buyer before facing a probable ban. While specifics regarding the implications of the U.S. sharing 50% ownership remain vague, sources have indicated that a partnership blending TikTok with an American company is more likely, enabling a distribution of profits and risks. This model could serve as a template for all Chinese-owned enterprises aiming to establish operations in the U.S.
Historically, joint ventures involving American companies operating in China — such as McDonald’s, General Motors, and Boeing — underline a collaborative approach, although China has relaxed some restrictions recently. For example, Tesla is permitted to operate independently as a wholly foreign-owned venture. An insider noted, “If an industry is required to be in a JV in China, [a Chinese company in that industry] needs to be a JV here. Trump loves the reciprocal trade framework… and he loves this [idea].”
Previously, Trump’s reciprocal trade strategy focused predominantly on tariffs. However, there is speculation that he may implement an executive order necessitating some of the approximately 5,000 Chinese companies presently functioning in the U.S. — such as Temu, Shein, and Alibaba — to collaborate with American partners. Current legislation, upheld by the Supreme Court, demands a complete divestment of TikTok from its parent company, ByteDance, creating uncertainty around whether a joint venture would suffice or whether the company would consider opening a joint venture or divestment.
TikTok has expressed a willingness to cooperate under Trump’s guidance. The company’s statement conveyed gratitude: “We thank President Trump for providing the necessary clarity… allowing over 7 million small businesses to thrive” during Trump’s inauguration visit by TikTok CEO Shou Zi Chew.
Forming a joint venture would also necessitate some measure of collaboration with China. While Trump stated, “I think he’d probably like it because he has nothing,” regarding Chew’s potential openness, approval from the Chinese government remains a critical component. Those interested in the TikTok acquisition may be given preference if they have prior dealings with the Chinese government.
Among potential investors, Elon Musk’s name has surfaced as a favored candidate, particularly due to his established connections in China stemming from his Tesla operations. Sources have speculated that China would have greater leverage if Musk acquired TikTok, and he is viewed positively due to pre-existing relationships and national security clearance across his businesses.
Musk’s interest could also lead to synergistic strategies enhancing both TikTok’s and X’s revenues, potentially paving the path for a revitalized social media platform along the lines of Vine. An unnamed source remarked, “If it had the blessing of Trump and Elon could buy TikTok… people want a competitor to Zuckerberg.” This scenario reflects a salient intersection of American business interests and strategic international cooperation.
President Trump’s proposal for a TikTok joint venture could redefine the operational framework for Chinese companies in the United States. The concept of shared ownership aims to foster reciprocal partnerships that align with existing trade policies, while discussions of collaborating with established figures such as Elon Musk highlight the complexities involved. TikTok’s responsiveness suggests a willingness to adapt, yet considerable uncertainties regarding regulatory compliance and the stance of the Chinese government remain significant factors in the unfolding narrative.
Original Source: nypost.com
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