The Chinese economy continues to do remarkably well given the state of 2020, but then the US economy is not doing badly either, amazingly. The final result of the pandemic on the various economies of the world is not yet decided. The government has now formally announced that the goal of ending poverty has been achieved, which was expected even with the virus disruption, but keep in mind Number 2 Li Keqiang’s surprising caveat back in May, saying that 600 million people have income amounting to only $140 a month. Putting aside the question of how to measure poverty, there is no doubt people in China are overall better off than they were before, even as the wealth gap between city and country continues to grow.
A key part of next year is going to be a reconsideration of US China relations, and we got a few pieces of information this week hinting at how things might go. Biden named his Secretary of State candidate, who has the wonderfully patriotic name of A. Blinken. Say it fast. Based on what we know of him, China will be a top priority and creating a consensus amongst various nations and players will be close to the top of the agenda. China’s leader, Xi Jinping, sent Biden a message with his personal congratulations on winning the presidency, saying: “I hope to see both sides uphold the spirit of non-conflict, non-confrontation, mutual respect and win-win cooperation, and focus on cooperation while managing and controlling disputes.” Liu He, meanwhile, also softened the tone, saying that China was committed to opening its economy, despite what many analysts interpret the New Big Policy, Dual Circulation, to imply — import substitution. Balanced against that is the announcement of new duties being slapped on Australian wine imports, of reportedly up to 212%. No wonder the phrase is “The glass is dry.”
It is becoming increasingly clear that China will fall far short of the targets for US purchases agreed in the trade war “cease fire” deal in January. Will Biden continue the hard line? Will TikTok be banned? Will Chinese scholars and students continue to be pushed out? Before we get to all those questions and more, we still need to hold our breaths over whatever else the lame duck Trump administration is planning before the clock strikes Jan 20.
Have a great weekend.