As we have forecast, the 20th century was the American century – the 21st century will be the Chinese century. The business of China is business; the business of America is war. 
While America spent countless trillions waging and losing endless wars and enriching its military-industrial complex, China has spent its trillions advancing the nation’s businesses and building its 21st-century infrastructure. The following overview of the current economic trends further paints the ups and downs of China’s economic future.
CHINA BECOMES TOP DESTINATION FOR FOREIGN INVESTMENT. For the first time, China surpassed the U.S. in 2020 as the world’s first choice for new direct foreign investment, according to data released by the United Nations Conference on Trade and Development on 24 January.
New investments from out of the country rose 4 percent in China last year. In contrast, foreign direct investors pared back their U.S. investments by 49 percent in 2020.
Investments from abroad dropped 71 percent across the European Union. Germany’s share of foreign funds slid 61 percent. Britain and Italy, both of which were hit especially hard by the virus, drew no foreign investment last year at all, the U.N. figures showed.
In comparison, East Asia drew a third of all foreign investment last year, its largest share on record. India saw a 13% increase, driven largely by rising demand for digital services.
China contained the COVID epidemic swiftly, then jump-started its manufacturing economy to export an increased wave of products around the globe as the rest of the world kept its economy largely shut under the threat of the virus.
As a result, China gained market share in more places and more industries than ever before. Its appeal as an investment is not losing its luster.
Walmart has announced it will sink $460 billion into projects in Wuhan, the Chinese city where the virus began, over five years. Starbucks will put $150 million into a roasting plant and “innovation park” in the city of Kunshan.
Tesla is adding a research center and expanding its plant in Shanghai, where the Disney Co. is building onto its Shanghai Disneyland Park.
Foreign investment in the U.S. crested at $472 billion in 2016; foreign investment in China that year was $134 billion. Investments in the U.S. have declined each year since.
Overseas investors’ cooling interest in the U.S. is a natural result of the U.S.’s open economy, which is more sensitive to the pressures of world events, Daniel Rosen, co-founder of the research firm Rhodium Group, said in a comment quoted by the Wall Street Journal.
In contrast, China’s government exerts more control over the nation’s economy and internal investment capital and can direct moves to take advantage of surprises such as the world economic lockdown. 
“There is no reason to be concerned about the outlook” for foreign direct investment “in the United States providing that the U.S. is sticking with its basic open-market competitive system,” Rosen added.
CHINA LAGS ON TRADE COMMITMENT. Almost a year after China agreed to import an additional $200 billion a year of U.S. products, it has bought only 58 percent of the amounts it promised, although purchases have accelerated recently in some categories, according to an analysis by the Peterson Institute for International Economics and reported by the New York Times
China has bought 64 percent of the farm products it agreed to, 60 percent of factory-made goods, and only 39 percent of energy products, Peterson’s data shows.
They note that the Biden administration must now decide whether to give China more time to make good on its commitment as its consumer economy begins to recover from the pandemic. 
Biden could leave Trump-era tariffs in place on $360 billion worth of Chinese goods entering the U.S. as a lever to pressure China to raise its imports, even though the tariffs raise prices for American businesses and consumers. 
During her confirmation hearing as Treasury Secretary, Janet Yellin stated that Biden plans no immediate changes to China policy but will “consult with allies to galvanize collective pressure” on China regarding government subsidies for its export industries and theft of intellectual property.
RENMINBI WILL BE STRONGER THIS YEAR, ANALYSTS PREDICT. China’s renminbi currency, now at a 30-year high against the dollar, will gain another 2 percent against the buck this year, rising to Rmb6.4 to the dollar, according to a median forecast among economists polled by Bloomberg.
The renminbi’s rise “has not reached an end,” Becky Liu, chief China macro-economic strategist at Standard Chartered, commented to the Financial Times. She expects the renminbi to reach 6.3 to the dollar during this year’s first half.
The dollar has weakened against a range of other currencies, in part, because of continued low interest rates and the U.S. Federal Reserve’s policy of spreading dollars liberally among other countries to help them weather the economic damage wrought by the global shutdown.
In contrast, China shut its economy quickly, reined in the COVID epidemic, then focused government aid on manufacturing and export industries to help revive the economy quickly as the rest of the world’s productivity collapsed.
“The strength in the renminbi you’re seeing now is a reflection of dollar weakness,” Michelle Lam, China economist at Société Générale, told the Times
That weakness, and the near-zero U.S. interest rates that have contributed to it, account in part for the $130 billion in foreign capital that now resides in China. While the U.S. Federal Reserve’s official interest rate languished near zero for much of last year, China’s markets were offering 3 percent or more.
The tide of capital will continue moving toward China this year, according to Goldman Sachs analyst Danny Suwanapruti, who sees another $5 to $10 billion a month in foreign funds arriving in China this year, accelerating to as much as $15 billion a month in October when Chinese government bonds will be included in FTSE’s world bond index.
The renminbi will reach 6.2 to the dollar this year, Goldman Sachs has forecast.
The renminbi’s continued power depends, in part, on the Chinese government, which still sets a daily range for the renminbi to gain value or retreat against the dollar within a 2-percent range.
TREND FORECAST: With the renminbi having its best run against the dollar during 2020’s last six months, the U.S. will not able to use its standard argument that China’s exports are going up because the value of its currency is going down and it makes their products cheaper to buy. 
The Wall Street bet that with Joe Biden replacing Donald Trump, he will act less confrontational and volatile trade policies is correct. Biden was a major champion of bringing China into the World Trade Organization under Bill Clinton’s presidency

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