Political economist & professor on China's modern economy & techno-geopolitics. A privilege to work
@LSE
@IEBiz
. Words in
@FT
@WSJ
; On global TV; Mom.
China may offer
#CIPS
, its alternative clearance system to
#SWIFT
, to Russia, with transactions cleared in the RMB.
In the short term, removal from
#SWIFT
is powerful.
Over the long term, it promotes alternative global currency order, to the detriment of the Dollar.
Zuckerberg on
#China
:
1. A present danger: 6 of top 10
#internet
platforms are Chinese.
2. A clash of internet values:
#Tiktok
exports a vision of the internet underpinned by Chinese values;
3. To defend
#Libra
is to defend
#US
financial dominance.
China plans permanent human presence on the Moon by 2036-2045.
New territorial frontier is officially extended to the Moon, by the US, China, and Russia, lawlessly.
Echoing the 17-19th century?
#Alibaba
’s neobank
#MyBank
lent to 10 million rural farmers in 4 years.
Remember this 3-1-0 model:
3 minutes to apply and reach a loan decision;
1 second to release the loan;
0 human intervention.
#fintech
#China
JUST IN:
#China
will cancel the debt of relevant
#African
countries in the form of interest-free government loans that are due to mature by the end of 2020.
Now, here is real economic leadership by China!
This is how global supply chain looked in 2019.
Japan does have a concentric role in the global supply chain, but on a smaller scale, which is not shown on the chart.
#Germany
and
#China
sat at the core of the global supply chains.
If there weren’t the Great Recession, there wouldn’t have been the great economic divergence between the East and the West. History may have been rewritten.
Greedy Wall Street should be accountable for many global issues today.
I had the great privilege to deliver my first lecture as a foreign faculty professor at the prestigious
@NDU_EDU
, on China’s Global Quest in the Xi Jinping Era.
I thank Dean Abid Ali & leadership of the NDU. I am deeply impressed about the academic rigor and policy independence.
China's GDP will surpass the GDP of the
#EU
(27 members combined) in 2020, with a near certainty now.
If China's GDP grows at 2% and EU contracts by 7% in 2020, this would take China's GDP to $14.7T, and the EU GDP to $14.4T(exchange rate constant).
An inflection point.
World, take a look at this aerial film release of a 1,000 beds hospital to quarantine
#WuhanCoronovirus
patients, which started construction on Chinese New Year’s eve, to be completed in 6 DAYs!
Only
#China
can do this! No other country can!
The first 21 years of the 21st century started with China’s accession to the WTO, the beginning of China’s meteoric rise. It ended with China’s pronouncement that it is on equal footing with the world(US).
Now it's about winning the 21st century. View
Henry Kissinger warned
#China
#US
conflict could be a lot worse than the Cold War, if allowed to fester.
He warned how the world sleep walked into World War I.
@neweconforum
#China
encourages private companies and state companies to invest in a mixed-ownership structure.
Mixed ownership is neither private nor state-owned.
#Tencent
invests in China Unicom.
#Geeky
invests in China Railway.
Do we call the new companies state owned or private?
In addition to Microsoft’s efforts to acquire a portion of Bytedance
#TikTok
, surely the Chinese state is going after Zhang Yining to acquire a portion of
#Bytedance
as well.
China produced 2.45 million and sold 2.42 million automobiles in July, nearing the highest figures on record.
Germany produced 264,000 and sold 206,000 in July, 10% of China's.
Global auto manufacturing center has solidly shifted to China.
China's export and import by lateral comparison.
Interestingly, the US, Germany, and China are not only the world's largest exporters, importers, but the centers of global production.
Small regional economies show tendencies to cluster into their industrial value chains.
70% of products manufactured by foreign companies in China is sold for the Chinese market. 30% is for export.
If foreign companies decide to leave China, they are leaving 70% of their revenue source behind.
Huang Qifan, leading state policy maker on
#China
’s economic cards.
#China
's per capita GDP passes $10,000 in 2019.
The major milestone comes with the worry of middle income trap.
Countries trapped after hitting $10K
#GDP
per capita:
#Malaysia
in 2011.
#Turkey
in 2008.
#Brazil
in 2010. All three countries are still lingering at those levels.
A Chinese colleague told me the US’s foreign policy seeks China’s submission. I find the view contextual in culture.
For hierarchies/autocracies, the ultimate goal is submission.
When the US went to Iraq, it did not seek submission. It sought victory. Submission is unAmerican.
Auto-generated both EN and CHN captions for a 10-min video in <5 minutes, with ~85% accuracy. All costs <$1.
Because the
#AI
service is so efficient, more people will use it, making AI smarter much faster.
Not doing a commercial. I am scared of how quickly this is happening.
Contributing shares to the UN regular budget.
China went from a 1% to 12% contributor over 20 years.
Japan shrank share contribution the most.
US has been responsible, despite complaints.
Wang Yi raised the new “ 4 No’s” in US-China relations.
The US shall not interfere with Chinese domestic politics; shall not harm Chinese sovereignty and territorial integrity; shall not suppress Chinese trade and technology; shall remove all illegal and baseless sanctions on
See the evolution of China’s concentric position in the global supply chain, and the countries most reliant on China in 2017.
Further, watch how much Japan’s concentric position in the global supply chain shrank.
Global connectivity Index in
@Huawei
’s annual report.
Note White circle is China. China’s connectivity is much more advanced comparing to its GDP per capita(deep in red), but still in the middle tier in terms of global connectivity.
Very interesting!
#Huawei
Happy new year to my dear 14.7K followers.
#China
is the biggest change variable of the century, for better or worse. Thank you for trusting me! Let’s together shape 2020!
National Security Advisor O’Brien outlined the US executive actions in detail to confront China:
1) The US banned telecom operators, such as Huawei, from accessing personal and private data in the US, and also imposed restrictions on US technology from going into Huawei; 1/
World's most valued unicorn is China's
@BytedanceTalk
at $140B valuation. Followed by:
Fintech Stripe (valued at $95B);
Aerospace manufacturer SpaceX ($74B);
China's ride-hailing company
@DidiGlobal
($62B);
Grocery delivery Instacart ($39B)
In the face of Chinese boycotts, a company would much rather be
#Nike
than
#H
&M.
Nike to China’s garment industry is analogous to chips to China’s telecom industry.
Here is why.
The average wealth of urban Chinese households is $449,200.
Beijing ranks the highest in average household wealth, at $1.2Million, among all Chinese cities.
#China
#TikTok
is the perfect platform using China’s engineering feat to spread the American soft power, not China’s own soft power, all over the world. If you watch TikTok, you know it’s the American soft power.
Interview with
#Yahoo
on launch of
#HeyChina
!
In a recent writing, I had to refer to China’s length of coastline. In Wikipedia, it says 14,000KM. In Chinese dictionary, it says 30,500 KM. Big difference for the obvious reason.
I can imagine global academics will soon fall victim and be asked to correct research too.
It’s my honor to speak with Nobel Laureate, MIT Prof. Bengt Holmstrom. He is a world’s best mind on corporate governance.
I look forward to exploring views on how to reconcile SOEs’ corporate governance structure, and the omnipotent role of the Party in business. On
@HeyChina2
#China
releases master plan for
#Hainan
Island, a southern Chinese island only 31 times the size of Hong Kong.
Unveiled plans replicate many of
#HK
’s current policies plus more. Hainan is set to unseat
#HongKong
as China’s global premier free trade export and transportation hub.
A 2-decade marriage comes to a stop.
Jack Ma and Masayoshi Sun announced leaving each other's boards, at
#Softbank
and
#Alibaba
today.
When Sun invested $20M in Alibaba, he wanted it to be the next yahoo!.
He was partially right and wrong. His $100M is today $100B.
#China
By 2025, 97% of large companies globally will adopt
#AI
.
It’s urgent now to think what small companies globally are going to do to compete? Adopt AI even before 2025.
Something learned from
#Huawei
’s annual report.
Economy is not good?
#US
gives cash, and
#China
gives digital coupons.
4Billion RMB digital coupons are issued by local governments to stimulate consumption in catering, sports, tourism.
Cash stimulus does not work for China, with a high savings culture.
Thoughts on implications of
#CoronaVirus
globally.
1. On Authoritarianism
There is NO correlation between epidemic containment and authoritarianism. Iran is authoritarian, but absolutely fails at the task. We need effective governments, whether authoritarian or democratic.
Chinese companies are listing in the US at record rate in 2021.
No one supports Chinese tech companies’ global rise more than American billionaires, and Wall Street financiers.
China’s industrial profit (Jan-April) has hit a high point since 2018, absorbing raw material price spikes.
This means commodities’ price hike has already been passed to Chinese-made final products.
Inflation will be spilled over globally now through China’s export.
From spokesman of
#China
’s Ministry of Commerce:
. Among 832 national poverty villages, online retail sales up by 13.3% in H1;
. ASEAN is now China’s No. 1 trading partner.
The more
#Trump
pushes hard on
#China
, the more he is likely to garner Chinese American votes.
Many of these are the economic “left behinds” by China’s rise, who have left too early, and not participated since. They wish Trump’s hardline will help reset the Chinese economy.
#UK
Prime Minister is hosting meeting to discuss
#Huawei
5G. In global 5G, Huawei’s competitors are
#Ericsson
,
#Nokia
,
#ZTE
. None is American.
The US has ZERO market share in 5G infrastructure, no matter who wins. How can the US miss such critical technology so completely?
China's fiscal revenue shortfall is estimated at ~$1Trillion. The fiscal drain directly affects China's ability to execute large infrastructure projects, the last-resort economic remedy. More gov't debt is demanded.
The 33-stimulus measures spelled out y'day is not enough.
Outbound FDI in 2019. China's ODI began to shrink in 2016, following a market crash and “go global”restrictions.
US's ODI fell below 0 in 2018, indicating Trump-era corporate on-shoring.
ASEAN+3 invested overseas nearly =Japan+US+China in 2019. ASEAN is now a major investor.
#China
’s second richest man, Colin Zheng Huang, founder of e-commerce platform
#PDD
, resigned from CEO post at 40.
It takes great wisdom to be No 2, in business or among countries.
China asked Russia to expand its electricity export to China, according to Russian press.
Pockets of Beijing will incur blackouts this holiday season.
This wave of blackouts is largely driven by coal shortage.
Pleased to offer this new course at the
@IEbusiness
IMBA.
China represents the single most important change variable to the global economy, along with the 4th industrial revolution. Now they’re compounded.
Standing at global business frontier requires modern China literacy.
56M Chinese are locked down now in effective “quarantine” in their cities. More over the coming days cannot go back to work or home. Businesses and schools will effectively be shut down after the holiday.
Major sacrifice by these people, and bravery!
#China
#coronoavirus
Huawei will debut its operating system, Harmony OS, in June. Harmony is forecast to be in 300M devices by the end of 2021, incld. 200M Huawei devices.
Harmony will be in Huawei cars, and possibly turn all things in its ecosystem smart.
The race is not over. It’s just on!
In this critical economic junction, the National Bureau of Statistics launched a special task force to investigate local governments’ GDP accounting fraud yesterday, echoing the suspicion over China’s economic performance.
“The (HK) fish tank is fine. We will just replace the bad fish with the good fish. “
#China
encourages state-owned companies to invest more heavily in
#HK
. Over time, HK will resemble economic characteristics more like a modern Chinese metropolis, rather than a Western one.
#China
will increasingly play a more active security role in the
#MiddleEast
. Since 2013, China has invested approx.
$10B in
#Iraq
$13B in
#Iran
, with $400B promised in 2019;
$120B in MENA region;
$186B in Sub-Saharan Africa.
Financial stake is too big to risk.
The GBA establishes its own university, focused on Science and innovation.
The
#GBA
has 10 times the population of the San Francisco Bay area and nearly twice its GDP.
#China
My take on
#Ant
with
@SPGlobal
.
"The restructuring, in a nutshell, means that Ant is now a financial company, not a technology company. Ant's push with corporate restructuring since 2017 to run itself as a technology company has failed."
China devises $7trillion infrastructure investments across 24 provinces as of March 24.
This is 10 times bigger than the monetary stimulus China pumped in 2008, of course unleashed over 5-10 years.
The plan is massive. It requires 70% to be financed by non-public sectors.
‘
@MSCI_Inc
launched 20 thematic indices to capture China’s megatrends.
These include disruptive technology index, future mobility index, robotics index, digital economy index, autonomous technology. Index...millennials, and aging society indexes.
Crystal clear!
A glimpse of China’s income disparity from the national Statistical yearbook.
In sum:
90% of Chinese earned <RMB 5,000 (US$767) a month.
62% earned <RMB 2,000 (US$307) a month.
Only 71 million people earned >RMB 10,000 (US$1,534) a month.
China's total newly contracted projects with
#BRI
countries hit c. US$31 billion, with a turnover of c. US$17 billion in the first quarter, up 19.4% and 12.4% respectively.
At this speed, China will be signing >$120Billion across the BRI in 2021.
China’s wealth management market stood at c. $18 trillion in 2020, following growth by 10 folds over the past decade.
It’s set to double before 2025, implying an incremental creation of $20 trillion market in 5 years.
#HSBC
pivots to China's wealth management market. The fastest-growing wealth management services arise from Chinese banks and trusts. HSBC, without a substantial commercial base, will find it hard to compete. Interview at
@SPGlobal
#China
singularly stepped up and cancelled zero interest debt repayments by Africa due before the end of 2020. No other country has done similar. Cancellation could potentially be up to a few billion.
This alone is exemplary.
My take
@LSEpublicevents
on
#Africa
debt relief.
#Tencent
is an investor in
#Tesla
,
#Reddit
Inc,
#Epic
Games,
#Snap
Inc... a trasnaaction ban with Tencent would potentially imply these US companies will need to sever “financial” relationships with Tencent.
The world is waiting for some interpretations of the executive order.
China will subject its world views to the world, just as the West subjects its. There’s no use keeping a world view to oneself.
Mutual subjectivity won’t narrow divergence. It sets up a battle for civilizational supremacy & owning the history.
#SCMP
Chinese RMB is already used to price Iran’s oil trade. It is the largest component of Iran’s foreign currency reserve. News from China rumors the transitory new currency Toman will be pegged to the RMB.
Petro-RMB already begins to form.
#EU
imports more from China than any other country, including the US.
China is only the EU’s third largest export market.
EU runs a €181 Billion deficit with China.
China invested US$7.7 billion in The US in the first 3 quarters of 2020, concentrated in entertainment, health and biotech, and natural resources.
It was Europe, not the US, that suffered the most from loss of Chinese investments, consistently from 2017 through 2020.
China is to be well prepared for a “contingency plan”, for 2020, from China’s Central Economic Work Conference.
This contingency plan would be a plan of “decoupling” from the
#US
. The contingency plan is not to change
#China
’s economic principles.
Day 5 construction of
#Wuhan
#caronavirus
1,000 bed hospital. 2-story structure nearly complete. There is no other country who can do this. I repeat!
There is also no
#China
economic miracle. The miracle is but its billion hard working people.
My interview with the world’s oldest newspaper
@Weekendavisen
, by Peter Harmsen.
#HongKong
must be part of a large South
#China
economic space, an 11-city cluster. It has to be some kind of Asian Silicon Valley, just bigger.
@LSEIGA
When will Germany overtake China as the second-largest economy? Don’t think in my lifetime.
When will India replace Germany as the third-largest economy? Should be less than 5 years.
India is every bit as authoritarian, protectionist, and oblivious to minority rights as
China is quickly ramping up R&D. The pattern of tech investment mirrors the GDP pattern.
China's R&D investment has surpassed the EU-28 (
#EU
&
#UK
) combined since 2016.
Japan's big problem is not that it's gotten old. It's that as it gets old, it stopped innovating.
Escalating anti-espionage law, raiding Bain Capital’s Shanghai office, arresting Dong Yuyu, suspending foreigners’ Wind data access, and expanding the border control list, China is doubling down on eradicating foreign influences.
I am aghast at how quickly things have
UK proposed new grouping of D10 (Democracy10).
#D10
includes
#G7
+India+
#Australia
+S.Korea.
D10 together take up about 53% of global GDP.
#China
today is about 17% of global GDP.
To be sure, China needs to allow the yuan to float more freely. The digital yuan won't be a standalone entity. The DCEP cannot become a global center currency, unless the yuan itself becomes one.
Interview with
@SPGlobalRatings
@HarvardAsh
Rumor says
#Microsoft
may be negotiating an asset swap deal with
#Bytedance
. What could it use to swap TikTok?
Yes, there is one. LinkedIn China!
LinkedIn is the only US social media legally allowed in China.
#China
may force Microsoft to sell it.
My presentation at the Annual Investment Meeting hosted by
#UAE
Ministry of the Economy, on China's investment in Africa.
Three themes were explored.
1. China's
#FDI
in
#Africa
.
2. Digital transformation in Africa.
3. China's lending to Africa.
The $100 billion man Bernard Arnault just adds
#Tiffany
to his shopping bag this Thanksgiving.
#LVMH
’s big bet is not Tiffany, but
#Tiffany
in
#China
.
Hardly can one consider 52.6% inflation to be good news, but it is.
,China’s pork price went up by 52.6% in August, coming down by 1/3 from 85.7% in July.
It pulled inflation down to 2.4%.
Some of China’s large wind energy investments globally:
1. China Energy Investment Corporation, the world’s largest wind energy company, invested in
#Greece
.
2. A consortium led by the state-owned China Resources purchased 30% of the Dudgeon Point wind farm in the
#UK
.