China’s premier has warned the world is entering a period of profound political and economic upheaval
Speaking in Beijing's Great Hall of the People, Li Keqiang, Premier of the China's State Council, opened the annual national people’s congress with the following remarks:
“There are many uncertainties about the direction of the major economies’ policies and their spillover effects, and the factors that could cause instability and uncertainty are visibly increasing.”
“In the face of profound changes in the international political and economic landscape, China will always stand on the side of peace and stability, will forever be committed to equity and justice, and will always work for world peace, contribute to global development, and uphold the international order,” Li said.
The Premier added that China should prepare for “more complicated and graver situations” as a result of developments “both in and outside China”.
The media is claiming that this is a not-so-subtle warning to Donald Trump and his idea of "America First". That's part of it. But there's a lot more here to unpack.
Trump's abrasive attitude towards Beijing has not gone unnoticed. During his speech, Li Keqiang said that China will "oppose protectionism in its different forms [and] become more involved in global governance.”
This is clearly a swipe at Trump and Brexit.
But it's no surprise that Beijing would be opposed to any kind of protectionism designed to favor U.S. manufacturing — China is Washington's largest goods trading partner:
China is currently our largest goods trading partner with $598 billion in total (two way) goods trade during 2015. Goods exports totaled $116 billion; goods imports totaled $482 billion. The U.S. goods trade deficit with China was $366 billion in 2015.
But here's what you won't read in the Guardian: If protectionism hurts China's market share in the U.S. and Europe, what is Beijing's contingency plan?
A stronger, more integrated Eurasia. More trade with Russia. The Silk Road Economic Belt will be fast-tracked.
To put it simply: BRICS. Not to mention the score of other eastern economic initiatives, including the Eurasian Economic Union and the Shanghai Cooperation Organization.
China may not like the idea of western protectionism, but it already has new markets and customers to do business with.
Trump's plans for protectionism aside, emerging economies — especially in the East — are changing the world's economic and political order.
As one of our cherished commenters, "Greg", pointed out:
Yes, China opposes western protectionism. But in twenty years there might not be much left for the West to protect.
Change is coming. Beijing is telling us to buckle up.
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