The never-ending US-China trade war talks are scheduled to resume on April 30, but more concretely the big BRI event is underway in Beijing, and officials are working hard to offset the negatives and accentuate the positives of doing the deals.
Terms for BRI deals are set to get better – Malaysia’s experience is particularly worth noting. The deal was done by the previous administration, Mahathir tried to cancel it and found that the penalty for doing so according to the contract was huge, and so he renegotiated the terms downwards instead. China spending money on global infrastructure is a good thing for all, as long as the terms are reasonable. Why the West has been so slow to match the BRI effort is puzzling, but the longer-term implications of the whole effort remain unclear. How much money does China have to spend on all these deals over the next two decades, and how effective and useful will some of the projects turn out to be? Those questions aside, China is now unquestionably a major player in ways and places that it was not a decade ago.
The top Huawei story this week is one from the UK – again. Top British security officials met and decided in TOP SECRET discussions that Huawei should be banned from participation in core parts of the country’s 5G network build out. It then got reported in full.
The overall China economic vibe is still perky, but the Shanghai stock market has been going through a significant correction, proving our point yet again, that there is no meaningful connection between the two. But the economic story that has our full attention is pork prices. Inflation is a core long-term concern in keeping the ship steady, and pork is fundamental to the Chinese lifestyle. Swine fever is now clearly on the march nationally, and meat prices are at record levels. The virus is untreatable and more than a million pigs have been killed in the past few months to halt its spread, but it’s clearly not working. Overall, it’s a really strong argument for vegetarianism.
Have a good weekend.