Source: China Trade News
Since the beginning of the Sino-U.S. trade friction in 2018, the undercurrent of anti-globalization has been surging. Although Sino-U.S. economic and trade relations will ease in 2022, the sudden Russian-Ukrainian conflict has once again exacerbated the cracking of the world economic pattern. The Chongyang Institute for Financial Studies, Renmin University of China, released a research report on May 20 entitled "The Great Crack: Assessment and Prevention of a New Cold War in the Global Economy after the Russia-Ukraine Conflict". The economy will show the following development trends: Russia will rapidly decouple from the West, mainly due to the long-term political differences between the two sides and the recent sanctions and counter-sanctions; Sino-US relations continue to deteriorate, mainly reflected in trade, ideology, etc.; The economic and trade exchanges between countries are developing from globalization to regionalization. Countries have different attitudes towards sanctions against Russia, resulting in a prominent political pattern between countries. The same interests require the deepening of trade exchanges between countries, but different interests require trade exchanges between countries. will decrease.
The report pointed out that countries around the world should focus on four major areas when preventing the outbreak of a new economic cold war. The first is the international energy field. Russia is a major energy country, providing energy security for the world's economies, especially for the EU. After the EU imposed sanctions on Russia, the backlash caused by the energy shortage has been quite obvious. Secondly, in the field of international currency, because the United States and the European Commission announced that some Russian banks were prohibited from using SWIFT services, Russian President Vladimir Putin signed a ruble settlement order for energy transactions, which in turn accelerated the global de-dollarization process. once again, in the field of international trade, in 2020, the United States and China will be each other's largest trading partners, and the two countries are the world's largest and second largest economies. If bilateral trade is further decoupled, the world economic pattern will fall into a more serious situation. The report believes that if the trade relationship between China and the United States is completely decoupled, it will reduce the US economy by at least 3.5 percentage points. Finally, in the field of international investment, the regional development of global trade will weaken the direct foreign investment of various countries, and the degree of openness of each country's trade to the outside world will be seriously threatened.
Wu Xiaoqiu, vice chairman of the Academic Committee of Renmin University of China, dean of the China Institute of Capital Markets, and director of the China-US Humanities Exchange Research Center, said that China's economic development achievements over the past 40 years show that opening up is a very important driving force for China's economic development. Opening up requires a relatively harmonious and stable international environment. China should do its utmost to ease the new Cold War mentality and make efforts to ease the world situation. This is not only very important to China's economic development, but also very important to China's status as a great power.
Wu Xiaoqiu also said that from an internal perspective, a series of effective measures should be taken to restore confidence and stabilize expectations, and efforts should be made to improve the socialist market economic system and promote market-oriented reforms. Marketization is still the basic direction of reform; It is also necessary to maintain the continuity and stability of the policy, and pay more attention to the improvement of the business environment.
In this regard, the report makes four recommendations for how to deal with the current situation.
First, try to prevent or delay the arrival of a new economic cold war. In view of the threats to the world economy posed by US hegemonism, unilateralism and protectionism, China should remain neutral on the Russia-Ukraine issue and urge a peaceful solution. In addition, China should take into account principles and flexibility on the issue of the United States, and on the one hand, it will never make concessions on core interests such as Taiwan, the South China Sea, and Xinjiang. On the other hand, on issues such as intellectual property rights, state-owned enterprises, state subsidies, and auditing of Chinese concept stocks, flexibility should be shown, and the U.S. appeals should be considered and proposed improvement plans through consultation.
Second, domestic efforts should be made to enhance economic strength and maintain medium-to-high-speed economic growth. Whether it can prevent or delay the arrival of a new Cold War in the global economy, or whether it can withstand the outbreak of a new Cold War, depends most fundamentally on China's own economic strength. China's economy must achieve a medium-high growth rate, that is, an average annual rate of 4% to 6%.
Third, actively act externally to promote the establishment of an "anti-Cold War front" and an "anti-power group". The countries along the “Belt and Road” are the basics of the “anti-Cold War front” and the “anti-power group”, and it is necessary to carry out more substantive, more selective and more strategic advancement. At the same time, the political and economic advantages of the SCO and BRICS countries to China also need to be deeply explored.
Fourth, accelerate the internationalization of the RMB. At present, the RMB can be said to be fully convertible under trade, but it is only partially convertible under capital: basically convertible under direct investment, and limited under financial investment. Among them, the inability to basically convert the RMB under the capital account is the main obstacle to the internationalization of the RMB, which must be eliminated quickly.
