Goldman Sachs CEO David Solomon expressed optimism about improving US-China relations and increased US investor interest in Chinese companies, while reaffirming the firm’s long-term commitment to the Greater China region despite geopolitical challenges. He also highlighted a positive outlook for M&A activity in the coming years and emphasized Goldman Sachs’ strategic use of AI to boost efficiency and productivity without reducing headcount.
Goldman Sachs CEO David Solomon discussed the recent historic meeting between the US and China presidents, describing it as constructive and a positive step toward de-escalation in their relationship. While acknowledging that much work remains to achieve a stable and enduring deal, Solomon expressed optimism about the potential for a US presidential visit to China in the fall. He emphasized that a one-year truce, though it introduces some uncertainty, is preferable to ongoing escalation and provides a realistic timeframe for negotiating a durable agreement that benefits both economies and global growth.
Regarding investment appetite, Solomon noted an increased interest from US investors in Chinese companies compared to a year ago, driven by attractive valuations and capital flow dynamics. However, he pointed out that foreign direct investment in China has decreased, largely due to ongoing geopolitical and trade uncertainties. Despite this, the improved IPO market in Hong Kong and the participation of foreign capital signal positive momentum. Goldman Sachs remains competitive in helping Chinese companies go public globally, leveraging its extensive global network and resources to provide clients with access to capital markets worldwide.
Solomon reaffirmed Goldman Sachs’ long-term commitment to the Greater China region, highlighting the firm’s global presence and leadership in investment banking, trading, and asset management. He acknowledged the challenges posed by geopolitical tensions and regulatory environments but stressed that China will continue to be one of the world’s most important economies alongside the US. The firm aims to serve clients seeking advice, capital, and resources in China and globally, adapting to changing conditions while maintaining a strategic focus on growth in the region.
On the topic of government intervention in business deals, Solomon differentiated between regulatory oversight and direct government investment in companies. While governments will continue to weigh in on transactions and regulatory approvals, he expressed skepticism about governments taking ownership stakes in companies as a general practice, advocating instead for free market principles that support capital formation and competition. He acknowledged exceptions but emphasized that such interventions are not the preferred direction for market development.
Looking ahead to the M&A environment, Solomon described the current climate as highly constructive, with a significant backlog of large-cap deals and increased CEO confidence in pursuing strategic transactions. He expects 2026 and 2027 to be strong years for M&A activity, particularly in the US. On the integration of AI, Solomon highlighted Goldman Sachs’ approach to using AI to enhance operational efficiency, automate processes, and improve productivity without necessarily reducing headcount. He compared AI adoption to past technological advancements that increased worker productivity and emphasized the firm’s focus on reinvesting efficiency gains into growth opportunities, while acknowledging that the rapid pace of AI-driven change may cause short-term disruption.