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RCEP to accelerate regionalisation of trade, as Asian importers eye markets closer to home
The Regional Comprehensive Economic Partnership (RCEP) will see Asian importers increasingly spurn business with the EU, US and other non-member markets, cementing the Asia Pacific region’s primacy in global trade, new UN research finds. However, analysts, including Senior Research Fellow Stephen Olson, questioned the potency of RCEP’s various tariff concessions, due to the number of trade agreements in place across the region. "A large portion of the trade liberalisation that is viable among the 15 members has already been reaped."
Planning for survival in the new normal
"Whether your current project is to address the exposure from disruptions to your supply chain or to digitize the entire enterprise as a result of the increasing disruption caused by technology-driven innovation, what’s becoming clear is that companies will be forced to become agile and adaptive", writes Jerry Peck in this commentary. Quoting a Hinrich Foundation report on “Strategic US-China decoupling in the tech sector”, the author notes that rising geopolitical risks will change business models at unprecedented rates of speed.
China plans to tighten rules on overseas IPOs
China is planning to tighten restrictions for Chinese companies that want to list overseas. And while Beijing won't ban them from trading abroad altogether, life might be getting a lot tougher for firms hoping to score more foreign investment. "China's cascade of new regulatory requirements, screenings, waivers, permissions and increased scrutiny around things like data security and foreign ownership are the equivalent of financial non-tariff barriers. The new red tape, much of which is opaque, simply isn't worth the hassle or the risk [for foreign investors]," said Research Fellow Alex Capri.
Xi Jinping has been taking on China's capitalists. Here's why that will change in 2022
At the forefront of Xi's mind is almost certainly a desire to keep the country running steadily ahead of a historic third term in office. "Xi's message of 'stability' is aimed at the political establishment in China, which must absorb the brunt of an historic power play, in addition to the business sector," said Research Fellow Alex Capri. "[It] also intended to assuage growing anxieties on Wall Street and within other corporate and financial hubs, which China relies upon far more than it cares to admit for investment, technology and trade."
Didi is leaving Wall Street. A 'perfect storm' means other Chinese tech stocks may follow
Chinese ride-hailing giant Didi wants to bail on Wall Street. It may soon have plenty of company. The pressure from both nations has created a "perfect storm" of problems for China's big tech firms who want to go public in New York, says Research Fellow Alex Capri. He called Didi's move a "harbinger of [the] increased fragmentation of global financial markets along geopolitical lines." Further down the road, Capri noted that Beijing's efforts to roll out a government-backed digital currency could create further obstacles for Chinese companies to list in foreign markets.
Epochal struggle: digital sovereignty and the EU
With data increasingly being treated as a commodity – that can be owned, controlled and protected – the concept of ‘digital sovereignty’ has become a key component of policy discourses on digital issues in recent years, with countries across the globe pushing to claim authority over their data. However, according to the 2021 Hinrich Foundation report ‘Digital Sovereignty: protectionism or autonomy?’, as an emerging policy area, digital sovereignty is by nature a “fuzzy” concept.
Why China wants to join the pact that once spurned it
Quoting Senior Research Fellow Stephen Olson, this article poses the question on whether China is prepare to adopt the far-reaching economic reforms it did to gain entry into the WTO in 2001. Olson is skeptical: "Many of its [the CPTPP] final provisions, although groundbreaking, fell short of lofty initial ambitions...Ample exceptions and wide loopholes would ease China’s compliance with the more challenging provisions...China has already demonstrated its immense skill in...nullifying trade rules in other agreements."
Biden and Xi move back from the brink
In this commentary by Daniel Snyder, the author noted that both US President Joe Biden and China President Xi Jinping clearly wanted to challenge the misperception that they are on the brink of conflict, and to prevent an unintended escalation of tensions that might become impossible to manage. Quoting Senior Research Fellow Stephen Olson, Snyder remarks that cooperation and engagement will take place, but the clear differences between China and the US will not go away. This article first appeared in The Oriental Economist.
The Biden-Xi meeting left one big question unanswered, says analyst
The US and China have just emerged from a high-profile meeting between their two leaders, with both sides striking a positive tone about their relationship going forward — but one big question remains unanswered. "Hard-edged, irreconcilable differences are embedded in each side’s view of the other. These cannot be wished away,“ said Senior Research Fellow Stephen Olson. "The open question for the broader relationship is whether the US and China can constructively manage the slow-motion collision that is now unfolding between their very different worldviews."
No clear breakthroughs at virtual Xi-Biden summit
The virtual summit between Chinese President Xi Jinping and his United States counterpart Joe Biden ended without any clear breakthroughs. Official statements showed no concrete deliverables, neither was a dramatic reset in the bilateral relationship imminent. Quoting an earlier commentary authored by Senior Research Fellow Stephen Olson, the "hard-edged, irreconcilable differences" between the US and China cannot be wished away, but can be managed in a way that limits the fallout, adding that this was in the interests of both countries.
Xi and Biden are meeting. There's a lot at stake for their economies
Managing America's relationship with its biggest economic frenemy is one of US President Joe Biden's toughest challenges. "One should not hold out false hope that the Xi-Biden virtual summit will fix the fundamental differences between China and America or change the general trajectory of the rivalry," said Research Fellow Alex Capri. "The overarching question is whether, under the best of circumstances, the two leaders can try and come up with the rationale for a new kind of 'competitive coexistence.'"
The US and China must consign Trump's trade deal to history
"When the Phase One purchase commitments expire at the end of December, they should be consigned to history, and both sides should start working on reducing the tariffs that remain. Only then can the U.S. and China get back to negotiating with each other in good faith", writes Bloomberg columnist David Fickling. Quoting Senior Research Fellow Stephen Olson, Fickling points out the fading effect of trade levies is not surprising. "Tariffs provide declining leverage over time as economies adjust to the new circumstances."