Best of the Week
Most Popular
1. Next Financial Crisis Is Already Here! John Lewis 99% Profits CRASH - Retail Sector Collapse - Nadeem_Walayat
2.Why Is Apple Giving This Tiny Stock A $900 Million Opportunity? - James Burgess
3.Gold Price Trend Analysis - - Nadeem_Walayatt
4.The Beginning of the End of the Dollar - Richard_Mills
5.Stock Market Trend Forecast Update - - Nadeem_Walayat
6.Hindenburg Omen & Consumer Confidence: More Signs of Stock Market Trouble in 2019 - Troy_Bombardia
7.Precious Metals Sector: It’s 2013 All Over Again - P_Radomski_CFA
8.Central Banks Have Gone Rogue, Putting Us All at Risk - Ellen_Brown
9.Gold Stocks Forced Capitulation - Zeal_LLC
10.The Post Bubble Market Contraction Thesis Receives Validation - Plunger
Last 7 days
SPX/Gold, 30yr Yields & Yield Curve – Amigos 1, 2 & 3 Updated - 21st Oct 18
Gold Stocks Sentiment Shifting - 21st Oct 18
Why Is the Weakness In GBP/USD Likely? - 21st Oct 18
Stock Market Bubbles, Balloons, Needles and Pins - 21st Oct 18
The Incredibly Bullish Set-Up for Gold - 20th Oct 18
Here Comes the Stock Market Retest - 20th Oct 18
Waterproof Camera - Olympus Tough TG-5 Setup and First Use - 20th Oct 18
Israel’s 50-Year Time Bomb, Pushing Palestinians to the Edge - 19th Oct 18
Bitcoin Trend Analysis 2018 - 19th Oct 18
History's Worst Stock Market Crash and the Greatest Investing Lesson! - 19th Oct 18
More Signs of a Stocks Bull Market Top and Start of a Bear Market in 2019 - 19th Oct 18
Stock Market Detailed Map Of Expected Price Movement Before The Breakout - 18th Oct 18
Determining the Outlook for Gold Mining Stock - 18th Oct 18
Investor Alert: Is the Trump Agenda in Peril? - 18th Oct 18
Stock Market is Making a Sharp Rally After a Sharp Drop. What’s Next? - 18th Oct 18
Global Warming (Assuming You Believe In It) Does Not Affect Gold - 18th Oct 18
Best Waterproof Compact Camera Olympus Tough TG-5 Review - Unboxing - 18th Oct 18
Silver's Time Is Coming - 17th Oct 18
Stock Market Volatility Breeds Contempt - 17th Oct 18
Gold 7-Year Bear Market Phase Is Over - 17th Oct 18
Gold - A Golden Escape - 17th Oct 18
Tec Stocks Sector Set For A Rebound? - 16th Oct 18
Real Estate Transactions are Becoming Seamless with Blockchain-Powered Data Sets - 16th Oct 18
Important Elements of a Viral Landing Page - 16th Oct 18
Stephen Leeb Predicts 3-Digit Silver and 5 Digit Gold?! - 16th Oct 18
BREXIT, Italy’s Deficit, The EU Summit And Fomcs Minutes In Focus - 16th Oct 18
Is this the Start of a Bear Market for Stocks? - 16th Oct 18
Chinese Economic Prospects Amid US Trade Wars - 16th Oct 18
2019’s Hottest Commodity Is About To Explode - 15th Oct 18
Keep A Proper Perspective About Stock Market Recent Move - 15th Oct 18
Is the Stocks Bull Dead? - 15th Oct 18
Stock Market Bottoms are a Process - 15th Oct 18

Market Oracle FREE Newsletter

Trading Any Market

The New US-Chinese Globalization Opportunity

Politics / GeoPolitics Nov 17, 2017 - 12:59 PM GMT

By: Dan_Steinbock

Politics While US postwar policies in Asia are shifting, a new Sino-US historical opportunity has emerged. US and Chinese visions of globalization could still prove complementary.

President Trump’s grueling 12-day Asia tour took place amid a worrisome historical moment. Since the mid-2010s, global economic integration - as measured by trade, investment and migration - has come to a standstill. Trade has been falling. Investment continues to stagnate. And slower migration has given rise to elevated global displacement and refugee crises - the worst since 1945.


After Japan, South Korea, China and Vietnam, Trump attended the Asia Pacific Economic Cooperation (APEC) Summit in Da Nang, Vietnam, followed by the 50th Anniversary of ASEAN in Manila.

It was the two leaders’ speeches in the Vietnam that seemed to leave room for an emerging opportunity – a new kind of globalization.

Competing views – only part of the story

In a defiant address, President Trump told the APEC meeting that the US would no longer tolerate "chronic trade abuses.” In turn, President Xi announced that globalization was irreversible.

In his speech, Trump complained about trade imbalances, arguing that America had lowered market barriers and ended tariffs, whereas other countries had not responded in kind. “Such practices hurt many people in our country,” he lamented.

Trump believed that those Bretton Woods multilateral organizations that America had created in the postwar era have become dysfunctional. So he railed against the World Trade Organization (WTO), which sets global trade laws, claiming that it "cannot function properly" if all members do not respect the rules.

Speaking right after his US counterpart, Chinese President Xi Jinping gave a strong address about the benefits world trade. Unlike Trump, Xi defended multilateral trade deals, which can help poorer nations to benefit: “"We should support the multilateral trading regime and practice open regionalism to allow developing members to benefit more from international trade and investment.”

Yet, neither leader has illusions about pure free trade ideals in which markets would be self-disciplinary and which thus would only generate winners.

“Globalization is an “irreversible historical trend,” Xi noted. Yet, he argued that the philosophy behind free trade must be repurposed to be "more open, more balanced, more equitable and more beneficial to all".

The great opportunity

Unsurprisingly, most Western media headlined the APEC Summit with the startling contrast: “Trump and Xi offer competing visions for trade.” What got lost in the translation was the intriguing fact – and historical opportunity – that the Trump and Xi visions need not be seen as exclusive.

In fact, both the US and Chinese visions support globalization, but with caveats. Both criticize the old multilateral international banks, though for different reasons. Both believe in rebalancing that is not accompanied by excessive trade deficits and foreign investment that should benefit both investors and destinations.

As aging advanced economies suffer from secular stagnation, they can no longer fuel world trade, investment and migration as vigorously as before. That’s reflected by Trump’s pessimistic narrative of a globalization victim.

Yet, the global economy is also amid a secular transition that is characterized by increasing South-to-South trade, investment and migration, which are now fueled by emerging and developing nations. And that’s reflected by Xi’s more optimistic narrative of a globalization champion. The big picture includes both narratives.

In the 21st century, the international environment that fuels global economic integration is shifting dramatically. While globalization was initiated by advanced economies in the 20th century, it will be completed by emerging economies in the 21st century. At the same time, the drivers of globalization are moving from the transatlantic axis to Asia.

It is thus not the competitive US-China visions that will lead to a destructive conflict in Asia Pacific. Rather, it is the inherent commonalities in the Sino-US approaches that have potential to sustain economic cooperation in the region – and globally.

Dr Steinbock is the founder of the Difference Group and has served as the research director at the India, China, and America Institute (USA) and a visiting fellow at the Shanghai Institutes for International Studies (China) and the EU Center (Singapore). For more information, see http://www.differencegroup.net/

© 2017 Copyright Dan Steinbock - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules