This is a good critical analysis, but I don’t think it’s entirely fair.
China are absolutely dominating on the world stage because they’ve played western countries at their own game, and are utterly beating them. It won’t really be in a practical position to be a serious anti- imperialist force until it exceeds western powers on its own feet, which it is some years away from yet.
China is doing far more to help third world countries than the odd euro-currency investment. But dominating the western currencies as well as your own gives you enormous global influence, whereas converting to solely yuan may keep them wealthy and independent, but have less stranglehold on the west.
The Chinese economy has already overtaken the US as the world’s largest economy back in 2015, FYI. The US economy is propped up by virtual sectors (real estate, finance) that have no bearing on the real economy.
Its only strengths are its military (seems to be handily defeated even by the Yemenis) and its currency (inflated thanks to all the money in the virtual sector). It is the latter that the US has been using to wreck the economies of the developing countries.
Yes China is doing a lot to help the developing world, but the problem is still the currency. China has no control over the huge piles of dollars and euros they have earned. They are as good as junk papers.
Chinese labor and resources utilized to serve Western consumers’ insatiable demand, and China only gets a pile of junk papers in return. All those disproportionate amount of Chinese labor and resources employed for export sectors could have been used to develop their own country instead. Can you imagine that.
This is the reason why China has been lending out these foreign currencies to Belt and Road and the other developing countries, because they literally don’t know where else to spend those junk money. They’ve stopped accumulating US treasuries since 2013, and started spending them on Belt and Road.
The problem here is that the developing countries now inherit the debt denominated in currencies that China has no control over, which means that the only way for the developing countries to pay them back is to sell stuff to the West to earn their currencies. This is not dedollarization, this is dollarization.
China’s problem is not that it still hasn’t have enough capital to take on the US. It’s the opposite: its economy has been geared so heavily towards the export sector that it needs Western consumers to have the ability to keep spending (that means a strong US currency), otherwise a lot of factories are going to have to shut down and many workers will lose their jobs. This means a recession and a crisis in China.
The only way out is to re-orientate towards its domestic sector (what they’re now calling the Great Internal Circulation) so that if Western economies fall, China doesn’t have to go down with them.
Again, there is always a price to be paid. You make a pact with the Great Satan, you are not allowed to get away unscathed.
This is a good critical analysis, but I don’t think it’s entirely fair.
China are absolutely dominating on the world stage because they’ve played western countries at their own game, and are utterly beating them. It won’t really be in a practical position to be a serious anti- imperialist force until it exceeds western powers on its own feet, which it is some years away from yet.
China is doing far more to help third world countries than the odd euro-currency investment. But dominating the western currencies as well as your own gives you enormous global influence, whereas converting to solely yuan may keep them wealthy and independent, but have less stranglehold on the west.
The Chinese economy has already overtaken the US as the world’s largest economy back in 2015, FYI. The US economy is propped up by virtual sectors (real estate, finance) that have no bearing on the real economy.
Its only strengths are its military (seems to be handily defeated even by the Yemenis) and its currency (inflated thanks to all the money in the virtual sector). It is the latter that the US has been using to wreck the economies of the developing countries.
Yes China is doing a lot to help the developing world, but the problem is still the currency. China has no control over the huge piles of dollars and euros they have earned. They are as good as junk papers.
Chinese labor and resources utilized to serve Western consumers’ insatiable demand, and China only gets a pile of junk papers in return. All those disproportionate amount of Chinese labor and resources employed for export sectors could have been used to develop their own country instead. Can you imagine that.
This is the reason why China has been lending out these foreign currencies to Belt and Road and the other developing countries, because they literally don’t know where else to spend those junk money. They’ve stopped accumulating US treasuries since 2013, and started spending them on Belt and Road.
The problem here is that the developing countries now inherit the debt denominated in currencies that China has no control over, which means that the only way for the developing countries to pay them back is to sell stuff to the West to earn their currencies. This is not dedollarization, this is dollarization.
China’s problem is not that it still hasn’t have enough capital to take on the US. It’s the opposite: its economy has been geared so heavily towards the export sector that it needs Western consumers to have the ability to keep spending (that means a strong US currency), otherwise a lot of factories are going to have to shut down and many workers will lose their jobs. This means a recession and a crisis in China.
The only way out is to re-orientate towards its domestic sector (what they’re now calling the Great Internal Circulation) so that if Western economies fall, China doesn’t have to go down with them.
Again, there is always a price to be paid. You make a pact with the Great Satan, you are not allowed to get away unscathed.