Connexion
Executive Summary
In November 2025, the 14th Session of the Standing Committee of the 14th National Committee of the Chinese People’s Political Consultative Conference (CPPCC), a top advisory body of the Chinese Communist Party (CCP), unexpectedly offered a window into the seismic shifts occurring within Chinese high-level politics. The official announcement of a sweeping personnel reshuffle included prominent figures such as Yi Gang (易纲), deputy director of the Committee on Economic Affairs (and former governor of the People’s Bank of China), and Wang Rong (王荣), deputy director of the Committee on Liaison with Hong Kong, Macao, Taiwan, and Overseas Chinese (former chairman of the Guangdong Provincial CPPCC) (Xinhua, November 1, 2025). They are among at least 20 officials who were removed from their primary positions in the latter part of 2025 (see Table 1).
The sudden exit of these heavyweights garnered significant attention. Their removal was unusual, as they had not reached the mandatory retirement age, nor were they implicated in any public corruption scandals. The phrasing used to describe their removal was that they “no longer held” (不再担任) their specific leadership roles—a distinction from the formal “dismissal” (免去) typically associated with disciplinary adjustments. That most of the officials targeted in the reshuffle retained their CPPCC membership (全国政协委员) suggests a nuanced political sidelining rather than a traditional purge.
This shift, initially visible at the periphery of Beijing’s power structure, was not an isolated incident but the visible tip of a broader overhaul. In the months surrounding the CPPCC’s actions, similar announcements stating that incumbents “no longer held” their posts or had “resigned” appeared across various regions and sectors. Prominent examples include Liu Duo (刘多), vice mayor of Shanghai (CPC News, September 26, 2025); Yan Aoshuang (闫傲霜), vice chairman of the Beijing Municipal People’s Congress Standing Committee (Beijing Daily, November 29, 2025); Lin Shangli (林尚立), president of Renmin University of China and former deputy director of the Central Policy Research Office (Ministry of Education, November 28, 2025), and Zhang Guangjun (张广军), former vice minister of Science and Technology and later party secretary of Huazhong University of Science and Technology (Ministry of Education, October 17, 2025).
These individuals all shared one commonality: significant overseas backgrounds and immediate family members residing abroad for extended periods. In other words, they were “naked officials” (裸官)—those whose spouses or children have emigrated. Analysis of these disparate personnel changes suggests that the CCP is recalibrating its organizational line through a campaign in which such officials are no longer carefully managed but actively excluded in pursuit of reinforcing national security (BBC Chinese, November 10). The imperative is to systematically excise elements vulnerable to Western sanctions or influence from critical nodes of national governance.
Regulatory Policy Shifts to ‘Zero Tolerance’
Over the past 15 years, relevant policies have progressed through three distinct phases, each corresponding to an escalation in Beijing’s perception of external threats. The evolution of the CCP’s regulatory framework concerning “naked officials” demonstrates the magnitude of the current clearance campaign.
Beijing’s regulation of “naked officials” began in the late Hu Jintao era. In the first phase (2010–2013), the policy tone was defined by “registration and management” (登记管理). The “Provisional Regulations on Strengthening the Management of State Functionaries Whose Spouses and Children Have Both Emigrated Abroad” (关于对配偶子女均已移居国（境）外的国家工作人员加强管理的暂行规定), issued in 2010, did not impose strict prohibitions on “naked officials” holding office (Xinhua, July 26, 2010). Instead, the focus was on information gathering to prevent asset flight and combat corruption. During this period, the system adopted a relatively tolerant attitude toward high-level intellectuals and technocrats with international connections, often viewing them as assets for connecting with the international community rather than security liabilities.
Under Xi Jinping, regulations tightened significantly. With the release of the “Measures for the Management of Posts Held by State Functionaries Whose Spouses Have Emigrated Abroad” (配偶已移居国（境）外的国家工作人员任职岗位管理办法) in 2014, the policy entered its second phase (2014–2024), characterized by “restriction and barring” (限制任职). These regulations explicitly list five categories of key positions barred to “naked officials,” including military, diplomatic, national security, confidential, and key leadership roles (Legal Daily, December 23, 2014). Having family abroad quickly became a glass ceiling for career advancement, though implementation retained considerable flexibility. High-ranking technical officials, particularly those outside core confidential departments, were often treated more leniently, especially if they adopted a “one family, two systems” (一家两制) arrangement where a spouse returned while children remained abroad.
Signs since early 2025 indicate that the policy has now entered a third phase: a “comprehensive clearance” (全面清理). Emerging enforcement patterns suggest that internal directives no longer distinguish between the sensitivity of positions nor tolerate compromise solutions. The current mandate reportedly presents bureaucrats of vice-ministerial rank or higher with a stark binary choice: repatriate family members or resign from office. The logic has shifted completely, from preventing corruption to preventing infiltration and ensuring political security. The ousters at the 14th CPPCC session demonstrate this zero-tolerance enforcement. Even second-tier political advisory roles or university presidencies are no longer admissible for senior-ranked officials with overseas family ties (Trivium China, November 6, 2025).
Traditional ‘Political Shields’ Fail Completely
The most striking feature of this clearance campaign is its indiscriminate intensity. To thoroughly eliminate potential internal vulnerabilities, the CCP leadership has established “political security” (政治安全) as the supreme imperative. Under this new logic, factors that previously served as political shields have been rendered ineffective.
Technocratic expertise, previously valued by the Party, no longer grants immunity. The forced departure of Yi Gang is perhaps the most indicative case. Yi had long been regarded as a quintessential “scholar-official” (学者型官员), holding a PhD from the University of Illinois and a tenured professorship at Indiana University. He spearheaded financial reforms, and international investors viewed him as a rational voice within the PRC’s economic decision-making circles (Caijing, March 12, 2023). Previously, despite restrictions, Yi successfully navigated his career due to his wife’s return to the PRC and his unique value to U.S.–PRC financial diplomacy. Under the zero-tolerance regime, however, the fact that his children remained overseas became an insurmountable obstacle (SingTao Headline, November 3, 2025). Yi’s fall sends a chilling signal that when political security overrides all other considerations, even internationally recognized professional value is no longer a defense against political scrutiny.
The clearance campaign also exposes the limits of factional patronage. Lin Shangli’s (林尚立) removal from the presidency of Renmin University of China illustrates the limitations of factional protection. Lin had a long tenure at the Central Policy Research Office, an organ under the CCP Central Committee, and was known as a close associate and core strategist for Wang Huning (王沪宁), a current Politburo Standing Committee member (Lianhe Zaobao, November 17, 2020). Given Renmin University’s status as the CCP’s “second Party School” (第二党校), its executive tier is typically vetted with extreme care. Nevertheless, Lin’s early overseas experience as a visiting scholar and his resulting family ties abroad led to the abrupt termination of his career. This demonstrates that traditional patronage offers no immunity against the supreme directive of national security. Even associates of core leaders must submit to the organizational cleansing logic when fundamental security issues are at stake.
United front assets also have become security liabilities. This shift is exemplified by the sidelining of Sui Jun (隋军). As the incumbent vice chair of the All-China Federation of Returned Overseas Chinese, a key united front body, Sui was long considered a typical “American qiaojuan” (美国侨眷), a term that refers to PRC residents with a overseas Chinese family in the United States (Caixin, May 16, 2018). For years, such connections were considered significant political assets, serving as a bridge for the CCP to the diaspora. However, under the new criteria, this former asset has been redefined as a liability. Beijing seems willing to sacrifice even the convenience of united front channels to eliminate the risk of internal infiltration at the source.
Strategic Repatriation and the Survivorship Bias
Focusing solely on the roster of removed elites risks misinterpreting the full scope of this campaign as merely a loss of talent or a sign of instability. In reality, the list exhibits a clear survivorship bias, in which the individuals publicly displaced represent the minority who refused—or were objectively unable—to comply with the directive to repatriate their family members.
For the majority of senior cadres, especially those in critical positions, the choice was existential. Faced with a political ultimatum, most chose to compel their relatives to return to the PRC. By late 2025, continuing to keep family abroad was widely viewed as a deliberate act of defiance; thus, the return of families under these circumstances is fundamentally coerced. Through these high-pressure tactics, Xi Jinping has achieved a subtle but significant tactical victory: he has successfully “repatriated” the strategic loyalty of the elite.
The logic of the policy shift extends beyond anti-corruption to the elimination of vulnerabilities to coercion. With family members repatriated, the physical pathways for Western intelligence agencies to infiltrate, subvert, or exert leverage through spouses or children are limited. [1] For bureaucrats who choose to recall their relatives to remain in the system, cutting off their overseas retreat is not merely a physical relocation but a “political pledge of allegiance” (投名状). [2] This trend is reinforced by the broadening use of exit bans to impose greater “political discipline and ideological loyalty” on cadres (The New York Times, August 3, 2025). In future international conflicts, these agents of the state, having burned their bridges, will have no choice but to demonstrate absolute loyalty to the system. This policy shift will thus harden the cohesion of Beijing’s decision-making core, rendering it more monolithic in the face of external pressure.
Reshaping Bureaucracy for Long-term Confrontation
The 2025 clearance is not merely a personnel adjustment but a move in preparation for a more volatile future international environment. The shift was driven in part by Beijing’s profound reflection on Russia’s war in Ukraine. The devastating impact of Western sanctions on Russian elites was exacerbated by the extent to which their assets and families were located within Western jurisdictions, creating a “soft underbelly” (软肋) for the Russian state. Beijing has internalized this lesson (CSIS, May 3, 2022). By weeding out figures like Yi Gang and Wang Rong who could not (or would not) sever overseas ties, Beijing is constructing a bureaucracy without strategic vulnerabilities. This appears to be a typical “pre-war” preparation, ensuring that in a future Taiwan Strait crisis or other geopolitical conflict, the executive layer will not waver due to concerns over family safety or asset freezes abroad.
The clearance regulations reflect a “political purification” (政治纯洁化) of the bureaucracy, characterized by a shift from internationalization to localization under the conditions of long-term confrontation. By removing technocrats with deep Western backgrounds, Beijing is establishing a new screening standard in which international competence is no longer a bonus but a potential security risk. This aligns with a broader trend observed since the 20th Party Congress, where traditional economic technocrats have been systematically replaced by security-oriented cadres with backgrounds in national security and the military-industrial complex. [3] This may lead to “reverse selection” (逆向淘汰) within the intellectual elite, but it is a cost Beijing sees as necessary and is willing to pay.
The PRC’s push for repatriation embodies the ethos of decoupling. Many observers see decoupling as a U.S. containment strategy, but Beijing’s actions indicate it is actively constructing an organizational and human capital firewall. By severing the private ties between its decision-making elite and the West, Beijing is preparing for a reality of two parallel worlds. It is sacrificing connectivity to ensure the absolute autonomy and security of its political core, a strategy that aligns with the broader “managed confrontation” architecture formalized in recent Party plenums (China Brief, November 3, 2025).
Conclusion
The purges of late 2025, though conducted without fanfare, will have profound structural implications for the PRC’s political landscape. They signal the gradual but definitive decline of the technocratic model that characterized the reform and opening era, under which Western education and global perspectives fueled the country’s rise. The new personnel orientation, however, demands that individuals pick a side between career prospects and international connections. This process of political purification inevitably blocks the path for returned overseas Chinese elites to reach high political office, as foreign affiliations are now often viewed as security liabilities rather than assets (The Conversation, September 26, 2023).
The PRC’s future bureaucracy is likely to be dominated by two types of individuals: those who are homegrown with no international exposure but are politically reliable, and opportunists who, despite overseas experience, have completely severed ties to prove their loyalty. This will lead to an increasingly inward-looking decision-making layer, lacking the shared intellectual framework necessary for dialogue with the West. Western policymakers should not read these personnel shifts as simple anti-corruption news but as a clear signal that Beijing is hardening its organizational structure for a protracted struggle (China Leadership Monitor, November 30, 2023). As a result, traditional channels of influence through personal networks are rapidly closing.
Table 1: Timeline of ‘Naked Officials’ Clearance (Provincial-Ministerial Level, 2025)
| Name | Removal Date | Position Removed From | Notable Former Position |
| Liu Duo (刘多) | September 25 | Vice Mayor of Shanghai (上海市副市长) | Director, Dept. of Science & Technology, Ministry of Industry and Information Technology (工业和信息化部科技司司长) |
| Liao Pinhu (廖品琥) | September 25 | Vice Chairman, Guangxi Govt. (广西壮族自治区政府副主席) | Director, Guangxi Health Commission (广西壮族自治区卫健委主任) |
| Shu Lichun (舒立春) | October | Party Secretary, Chongqing Univ. (重庆大学党委书记) | Director, Chongqing Education Commission (重庆市教委主任、市委教育工委书记) |
| Zhang Guangjun (张广军) | October 17 | Party Secretary, Huazhong Univ. of Sci. & Tech. (华中科技大学党委书记) | Vice Minister of Science and Technology; President, Southeast Univ. (科学技术部副部长；东南大学校长) |
| Yi Gang (易纲) | November 1 | Deputy Director, CPPCC Committee on Economic Affairs (Ministerial Level) (全国政协经济委员会副主任 [正部级]) | Governor, People’s Bank of China (中国人民银行行长) |
| Wang Rong (王荣) | November 1 | Deputy Director, CPPCC Committee on Liaison with Hong Kong, Macao, Taiwan and Overseas Chinese (Ministerial Level) (全国政协港澳台侨委员会副主任 [正部级]) | Chairman, Guangdong CPPCC; Party Secretary of Shenzhen (广东省政协主席；深圳市委书记) |
| Zhang Taolin (张桃林) | November 1 | Deputy Director, CPPCC Committee on Agriculture and Rural Areas (全国政协农业和农村委员会副主任) | Vice Minister of Agriculture; Vice Governor of Jiangsu (农业部副部长；江苏省副省长) |
| Zhang Jie (张杰) | November 1 | Deputy Director, CPPCC Committee on Education, Science, Health and Sports (全国政协教科卫体委员会副主任) | Vice President, Chinese Academy of Sciences (CAS); President, Shanghai Jiao Tong Univ. (中国科学院副院长；上海交通大学校长) |
| Cao Weixing (曹卫星) | November 1 | Deputy Director, CPPCC Committee on Education, Science, Health and Sports (全国政协教科卫体委员会副主任) | Vice Minister of Natural Resources; Vice Governor of Jiangsu (自然资源部副部长；江苏省副省长) |
| Sui Jun (隋军) | November 1 | Deputy Director, CPPCC Committee on Foreign Affairs (全国政协外事委员会副主任) | Vice Governor of Fujian Province (福建省副省长) |
| Chen Guoqing (陈国庆) | November 1 | Deputy Director, CPPCC Committee on Social and Legal Affairs (全国政协社会和法制委员会副主任) | Deputy Procurator-General, Supreme People’s Procuratorate (最高人民检察院副检察长) |
| Zhang Junkuo (张军扩) | November 1 | Deputy Director, CPPCC Committee on Proposals (全国政协提案委员会副主任) | Deputy Director, Development Research Center of the State Council (国务院发展研究中心副主任) |
| Chen Yuanfeng (陈元丰) | November 1 | Deputy Director, CPPCC Committee on Liaison with Hong Kong, Macao, Taiwan and Overseas Chinese (全国政协港澳台侨委员会副主任) | Deputy Director, Taiwan Affairs Office of the State Council (中央台办/国台办副主任) |
| Meng Qinghai (孟庆海) | November | Vice Chairman, China Association for Science and Technology (中国科协副主席、书记处书记) | Vice Governor of Liaoning Province (辽宁省副省长) |
| Shao Zhiqing (邵志清) | November | Vice Chairman, Shanghai CPPCC (上海市政协副主席) | Deputy Director, Shanghai Economy and Informatization Commission (上海市经信委副主任) |
| Guo Jianchun (过建春) | November 27 | Vice Chairperson, Hainan Provincial People’s Congress Standing Committee (海南省人大常委会副主任) | President, Hainan Normal University (海南师范大学校长) |
| Lin Shangli (林尚立) | November 28 | President, Renmin University of China (中国人民大学校长) | Deputy Director, Central Policy Research Office (Secretary-General) (中央政策研究室副主任、秘书长) |
| Yan Aoshuang (闫傲霜) | November 28 | Vice Chairperson, Beijing Municipal People’s Congress Standing Committee (北京市人大常委会副主任) | Director, Beijing Municipal Science & Technology Commission (北京市科委主任) |
| Zhang Zongyi (张宗益) | November 28 | President, Xiamen University (厦门大学校长) | President, Chongqing University (重庆大学校长) |
| Su Xiaohong (苏晓红) | December 4 | Vice Chairperson, Henan Provincial People’s Congress Standing Committee (河南省人大常委会副主任) | President, Pingdingshan University (平顶山学院院长) |
(Source: Compiled by the author)
Notes
[1] The Ministry of State Security was very vocal about such risks in 2025, warning that foreign intelligence agencies are actively targeting PRC nationals abroad and those with foreign connections for recruitment (China Brief, November 14, 2025).
[2] The term toumingzhuang (投名状) historically refers to a pledge of allegiance, often requiring an individual to commit an incriminating act or cut off their retreat to prove loyalty. For analysis of how the CCP’s disciplinary apparatus enforces political loyalty, see Ling Li, “Politics of Anticorruption in China: Paradigm Change of the Party’s Disciplinary Regime 2012–2017,” Journal of Contemporary China 28(2019): 47-63.
[3] For an analysis of the diminishing role of Western-trained technocrats under Xi Jinping, see Tai Ming Cheung, “New Leaders in ‘National’ Security after China’s 20th Party Congress,” UCSD Forum on U.S.-China Relations, November 30, 2022.
The post Beijing Accelerates Clearance of ‘Naked Officials’ from Top Ranks appeared first on Jamestown.
Paul and Ken assess how China’s economy goes from strength to strength whilst it continues to decouple from the U.S. and demonstrates how U.S. tariffs have been a failure.
Thanks to Tariffs, China Ditching US Tech. Napolitano interviews geopolitician Pepe Escobar, April 30th, 2025.
“… in this wilderness of narrative mirrors, Trump should be perceived as all characters combined: the White Rabbit, Humpty Dumpty (“When I use a word, it means what I choose to mean, no more and no less”), the Mad Hatter, the Queen of Hearts (“Off with their heads!”)”
Huawei chips are already the real deal for every Chinese company which is following the new Beijing-defined direction to reduce any reliance on American technology
By Pepe Escobar at Sputnik.
Late next month, Huawei will be testing its new powerful AI processor, the Ascend 910 D, even as by early May the previous 910C will start to be mass-delivered to scores of Chinese tech companies.
These serious breakthroughs are the next chapter of Huawei’s drive to counter Nvidia’s global monopoly in graphics processing units [GPUs]. The Ascend 910D is supposed to be more powerful than Nvidia’s extremely popular H100.
Huawei is pulling no punches in its race to manufacture a new generation of processors. Huawei has collaborated with SMIC – China’s largest semiconductor foundry – to apply Deep Ultraviolet Lithography (DUV) on what was previously only possible on EUV (Extreme Ultra-Violet technology). Once again, Huawei and SMIC defied the proverbial American “experts” with creative engineering solutions.
Huawei arrived at fabricating 5nm chips with DUV even as the process is more expensive than with EUV. If Huawei had access to EUV they would be already manufacturing 2-3nm chips. That will come, in short time, as both China and Russia, under permanent US high-tech blockade, must by all means develop their own EUV technology.
Shanghai geeks are convinced that Huawei will switch on 6G networks before the end of the decade. Their current breathless drive is not just aimed at the smartphone front – where Huawei is peerless; the new Huawei Mate 70 Pro + is by far the absolute top smartphone in the world, running on Harmony OS. Huawei is looking at cloud computing, AI and enterprise servers – and to become no less than the core player in the AI infrastructure race.
Ditching Any Reliance on American Technology
Earlier this month, Huawei introduced the CloudMatrix 384, a system connecting 384 Ascend 910C chips. The tech word in Shanghai is that this configuration, under certain conditions, and of course consuming much more power, already outperforms Nvidia’s flagship rack system – which is powered by 72 Blackwell chips.
Meanwhile, Huawei’s Kirin X chip is targeting the PC market, offering stiff competition to Apple, AMD, Intel and Qualcom while Harmony OS plus removes the necessity of using US software such as Microsoft and Android.
Shanghai geeks swear that China essentially doesn’t need to beat Nvidia or other US chips developers. After all, China already has the largest consumer market in the world – by volume and by value. If a parallel tech universe is the likely result of the Trump Tariff Tizzy (TTT), so be it. China already controls over 60% of the global gadget consumer market.
Kirin X may not – yet – match the power of Nvidia’s H100 GPUs. But Huawei chips are already the real deal for every Chinese company which is following the new Beijing-defined direction to reduce any reliance on American technology.
All of the above naturally brings us to the enormous AI elephant in the (digital) room: Nvidia.
A recent book, The Thinking Machine: Jensen Huang, Nvidia, and The World’s Most Coveted Microchip, is quite helpful to track not only the personal story of CEO superstar Huang, a Taiwanese who played the American Dream to the hilt and became a tech multi-billionaire, but Nvidia’s enviable tech accomplishments.
Huang does not interpret AI as emergent machine superintelligence, and firmly dismisses any direct analogy to biology. For this all-round pragmatist, AI is merely software – running on hardware that his company sells for a fortune.
Still, Nvidia has ventured into virgin territory way beyond the American biz-tech Valhalla, complete with holding the most valuable stock on the planet: arguably, when it comes to AI, Nvidia unveiled a new phase of evolution.
It’s crucial to understand how Huang sees China. It is indeed a key market for his AI chips – and he wants to keep selling them in droves. Trump’s tariffs though make sure that won’t happen.
And that’s what moved Huang to ditch his proverbial leather jackets and don a crisp business suit for a strategic visit to Beijing, where he affirmed the sacred importance of the Chinese market, whatever the new Trump-dictated gimmicks.
By 2022, the China market represented 26% of Nvidia’s business; this year, it has fallen to 13%, because of euphemistic “technology export controls”.
The problem is the US government, already by 2022, under the previous automatic pen administration, had blocked sales to China of advanced A100 and H100 chips. Nvidia started selling modified versions – and even after the ban chips continued to arrive in China. By June 2023, it was easy to find A100s for double their price in the black market in Shenzhen.
Huang is convinced that “no AI should be able to learn without a human in the loop” – even as he admitted, two years ago, that “reasoning capability is two or three years out”. Translation: according to Huang AI will start thinking for itself within the next few months.
Even as Nvidia prepares to invest billions of dollars to build AI supercomputers in Texas, the Chinese essentially are not losing any sleep on “thinking AI”: their focus is extremely practical, to conquer not only the Chinese market but also the supply chains of most of Eurasia.
The US National Security Council has concluded that it’s too dangerous for China to buy Nvidia’s high-end chips, even the H20 – designed for the Chinese market. Huawei, anyway, already produces chips somewhat comparable to the H20.
Huang is losing his sleep because, essentially, Nvidia is losing the immense Chinese market to Huawei – with Trump’s direct input. Nvidia has tens of thousands of H20s specially designed for China which they simply cannot sell. Each chip cost between $12,000 to $20,000.
How China Is Opening a Digital “Pandora’s Box”
Huawei’s new drive is yet another example of Chinese will capable of staring down any challenge – based on indigenous talent, tech expertise and national pride. The record, even before Trump 1.0 sanctions, shows that Huawei does eat massive uphill battles for breakfast. In fact Ascend in many aspects was ahead of Nvidia as early as in 2019 – and that’s why two different US administrations banned it.
China is already light years ahead of the US on chip research. Chinese universities amass most places in the global Top Ten for published papers on semiconductors and on citations – a distinction shared, among others, by the Chinese Academy of Sciences (number one), Tsinghua University (one of China’s top two universities), the University of Electronic Science and Technology of China (number four), and Nanjing, Zhejiang and Pekin Universities.
Two weeks ago in Shanghai I first heard that Huawei would catch up with US semiconductor giants in maximum two years. Now, after the announcement of the Ascend 910D, the buzz shifted to only one year for China to overtake Nvidia and develop better lithography machines than the ones currently produced by ASML.
And the debate is fast switching to how far Huawei will be able to go within the next 2 to 3 years.
In several aspects we are already in the early stages of a US-China tech decoupling. For years Nvidia has dominated the AI hardware space. Their GPUs are the brains behind most contemporary advanced AI. The H100 chip is the gold/platinum standard for AI infrastructure worldwide. Nvidia’s chips had huge demand from Chinese tech giants – Alibaba, Tencent, Baidu, Bytedance.
Soon that may not be the case – and that goes way beyond Nvidia’s certified loss of market share in China. China is now all out focused on building a successful, self-sufficient AI hardware ecosystem. The coup de grace will be to restrict the export of all rare earth minerals to the US. Huaweii then will pull up in no time.
Everyone remembers how DeepSeek R1 wiped out over $1 trillion from Wall Street only three months ago. DeepSeek R2 will be released soon; training was a whopping 97% cheaper than OpenAI.
And training happened on Huawei’s Ascend. No Nvidia.
Quantum Bird, a world-class physicist formerly with the CERN in Geneva, puts everything in much needed context. He stresses how indigenous chip development by China – and in a near future, Russia and probably India – is “multi-faceted; what we are observing are the initial stages of a redefinition of the notion of recognizing patterns and machine learning, technologies that are popularly referred to as ‘AI’ by the media.”
Nvidia chips, Qantum Bird remarks, are indeed “computational beasts”, but they work better around “processing models and workloads typical of ‘AI’ models developed by Western scientists.” DeepSeek’s development, on the other hand, showed a transgression of established models: “The possibilities opened for performance leaps are huge, even using relatively modest hardware, with alternative approaches based on advanced math and different calculus flows.”
In a nutshell: “This is the Pandora’s box that Nvidia now fears the Chinese may have opened”. And that totally ties in with Huang’s red alert, prompting his visit to Beijing.
We may be heading indeed towards a serious tech decoupling. Or as Quantum Bird frames it: “A technological and scientific divergence medium and long-term. If the architectures that emerge from these developments are incompatible when it comes to their usage on specific ‘AI’ models, Nvidia will lose its global monopoly and will become just a company reduced to a corporate/scientific Western niche.”
Even as Huawei, from its privileged base in the Chinese market, will go on to win most markets across the Global Majority – from BRICS to BRI.
Captain Chaos definitely does not have the cards – which as even South Pacific penguins know, are all made in China.
By Pepe Escobar at the Strategic Culture Foundation.
SHANGHAI and HONG KONG – So, predictably, Captain Chaos did blink first. As much as he – and his sprawling media circus – could not possibly admit it.
It all started with “tariff exemptions” – from smartphones and computers to auto parts – on products imported from China. Then it veered towards carefully manicured leaks implying tariffs “could” be reduced to a range between 50% and 65%. And finally a terse admission that if there’s no deal, a “tariff number” will be unilaterally set.
China’s Ministry of Commerce was unforgiving: “Trying to trade away others’ interests for temporary gains is like bargaining with a tiger for its skin – it will only backfire”.
And it got fiercer. The Ministry was adamant that any Trump 2.0 claims of any progress on bilateral negotiations have “no factual basis” – de facto depicting the US President as a purveyor of fake news.
Tigers, tigers burning bright: the image does not recall poetry superstar William Blake, but Mao’s legendary depiction of the US Empire as a “paper tiger” – a flashback that struck me over and over again last week in Shanghai. If the US Empire was a paper tiger already in the 1960s, the Chinese argue, imagine now.
And the pain will increase, not only for the paper tiger: any dodgy deals made by foreign – vassal – pussycat governments at the expense of Chinese interests simply will be not be tolerated by Beijing.
Last week in Shanghai I was reminded over and over again – by academics and business people – that the weaponized Trump Tariff Tizzy (TTT) goes way beyond China: it is a desperate offense ordered by the US ruling classes against a peer competitor that scares the hell out of them.
The best Chinese analytical minds know exactly what’s going on in Washington. Take for instance this essay originally published by the influential Cultural Horizon magazine breaking down the “triangular power structure” of Trump 2.0.
We have all-power Trump forming a “super-establishment”; Silicon Valley money politics, represented by Elon Musk; and the new right-wing elite represented by VP J.D. Vance. End result: a “governance system that is almost parallel to the federal government.”
European chihuahuas – caught in the crossfire of Trump 2.0 – are simply incapable of such synthetic and precise conceptualization.
Paper tiger meets fiery dragon
What a deep dive in Shanghai has revealed is that China has been handed over a rare earth-like opportunity by Trump 2.0 to consolidate its strategic initiative solidifying the role of leader of the Global South/Global Majority, at the same time carefully managing the risk of a New Cold War.
Call it a Sun Tzu move that may paralyze the Empire in its tracks. Professor Zhang Weiwei, with whom I had the pleasure to share a seminar in Shanghai on the Russia-China strategic partnership, would agree.
China is on the move across the spectrum. Chinese Premier Li Qiang sent a letter to Japanese Prime Minister Shigeru Ishibe urging a joint drive, right now, to counteract the tariff dementia.
President Xi’s top message in his Southeast Asia tour last week was to stand up against “unilateral bullying”.
Xi deftly moved between Malaysia – current rotating chair of ASEAN, always avoiding taking sides – and Vietnam – with its “bamboo diplomacy” always hedging between US and China.
Xi told Malaysia’s Prime Minister Anwar Ibrahim, directly: “We must safeguard the bright prospects of our Asian family”. Translation: let’s create an exclusive sphere of influence close to the ‘community of shared destiny’ but that does not include outside powers such as the US.
In parallel, there has been a strong debate – from Shanghai to Hong Kong – that transcends the role of China as the world’s factory: what matters now is how to redirect some of China’s astonishing manufacturing capacity towards the domestic market.
Of course there are problems – such as the lack of purchasing power among scores of Chinese domestic consumers, even as the bulk of national China income is directed to fixed-asset investments. A great deal of China’s rural elderly population survives on a monthly pension of roughly $30 a month, and the hourly rate for the gig economy has stagnated at around $4.
Meanwhile, in several high-tech fronts, China just built the fastest high-speed train on the planet: 400km/h, soon to run between Beijing and Shanghai. China is already receiving orders for the C919 commercial wide-bodied airliner. And China has come up with the world’s first thorium-powered nuclear reactor. Translation: unlimited cheap and clean energy is at hand.
The Mafia way of doing business
Hong Kong is a very special case. HSBC executives, for instance, worry about a possible decoupling between US and China – and wonder whether Hong Kong may survive without US trade.
Yes, it can. The US is Hong Kong’s third largest trade partner; yet Hong Kong’s export and import to the US are only 6,5% and 4%, respectively, of its total global exports and imports, including transshipment of goods back and forth from the mainland.
HK is a world-class logistics hub and free port. So as long as Trump 2.0 does not forbid trade with Hong Kong – well, anything can happen – imports should not be affected. Anyway, most of what HK exports – electronics, luxury goods, clothes, toys – can easily find alternative markets in Southeast Asia, West Asia and Europe.
The crucial point is that over half of Hong Kong trade is with the mainland. And the key fact is that China can easily survive without US trade. Beijing has been carefully preparing for it since Trump 1.0.
From Shanghai to Hong Kong, the best analytical minds are in tune with the inestimable Michael Hudson, who has emphasized, over and over again, how “the United States is the only country in the world that has weaponized its foreign trade; weaponized its foreign currency, the dollar; weaponized the international financial system; and treated every economic relationship in an adversarial way, to weaponize it.”
A self-confident, high-tech savvy China, from academics and business people to xiao long bao and pulled noodles vendors, graphically understands that the Empire of Chaos, in its drive to “isolate” China, is only isolating itself (and its chihuahuas).
Moreover it’s such a joy to see Michael Hudson also referring to the same “paper tiger” syndrome that I witnessed in Shanghai these past few days: “Well, America has become a paper tiger financially today. It doesn’t really have anything to offer except the threat of tariffs, the threat of suddenly disrupting all of the trade patterns that have been put in place over the last few decades.”
In Shanghai, I heard serial implacable dismissals of the so-called “Miran plan” – as in the paper published last November by Trump’s economic advisor “restructuring the global trading system”. Miran is the brain behind the Mar-a-Lago accord – whose rationale is to weaken the US dollar by forcing major economies – from China to Japan and the EU – to sell US dollar assets and swap short-term US Treasuries for 100-year bonds with zero interest.
Miran’s brilliant idea boils down to nations having only two options:
Zhao Xijun, co-dean of the China Capital Market Research Institute at Renmin University, destroyed the scheme succinctly: transferring money to the US Treasury like this is like “collecting protection money on the streets”. Translation: that’s the Mafia way, “a thuggish and domineering act, merely dressed up with the lofty justification of providing public goods”.
Meanwhile, in the Grand Chessboard, Beijing keeps working steadily side by side with Russia towards a Eurasian-wide security architecture anchored on a balance of powers: it’s all about the new Primakov triangle (RIC – Russia, Iran and China).
Top BRICS members Russia and China will not allow the Empire to attack fellow BRICS member Iran. And support comes in more ways than one. Example: more imperial energy sanctions on Iran? China will increase imports via Malaysia, and invest even more in Iran’s infrastructure, in tandem with Russia in respect to the International North South Transportation Corridor (INSTC).
In a nutshell: Captain Chaos definitely does not have the cards – which as even South Pacific penguins know, are all made in China.
Shanghai shows China relishes its new role as a Resistance beacon, bent on defying bullying, busy building a Global Majority consensus. It’s all about strategic patience …
By Pepe Escobar at Sputnik.
SHANGHAI – There could not be a more strategic place to spend these past Trump Tariff Tizzy (TTT) heady days than in Shanghai – China’s trade, commercial and cultural capital.
From the top of the Jin Mao tower in the world class Lujiazui financial district in Pudong, an elegantly discreet art deco companion to the World Financial Center super-skyscraper – the trademark symbol of China’s economic power – it’s as if the spokes of a wheel radiated to the Bund and beyond tracking a ceaseless drive to counteract the absurd idiocy of the “Emperor of Tariffs”, relentless mocked across myriad Chinese social media platforms.
I have had the privilege to transit from the Bund Financial Center, which hosts among others the Fosun Foundation – a bamboo-inspired architectural masterpiece – to the China Academy at the immaculate campus of Fudan University, where I shared a seminar with star professor Zhang Weiwei and a round table with top PhD students from several disciplines. Professor Zhang Weiwei is the foremost conceptualizer of China as a civilization-state.
The key theme of our seminar was the Russia-China strategic partnership, but inevitably the focus switched back and forth to the rationale behind the Emperor of Tariffs. The questions from the students were as sharp as they come. That was compounded with an in-depth interview for China Academy hosted by their CEO, the formidable Pan Xiaoli.
A visit to the HQ of Guancha – the top independent new/analysis site in China, whose several channels in several different platforms reach an astonishing 200 million people – could not have been more timely. Guo Jiezhen, a research fellow from the China Institute, who was part of our round table at Fudan University, came up with one of the more astute analyses of what he describes as Trump’s “deranged money-making technique“.
While meeting with Guancha’s new editor-in-chief He Shenquan and discussing with hyper-competent international relations specialist Kelly Liu and Yang Hanyi – the China Institute’s communication officer – we watched together an exceptional podcast featuring PLA Colonel Wang Lihua, Gao Zhikai – Deputy Director of the Center for China and Globalization (CCG) – and the always essential Li Bo, President of the Shanghai Chunqiu Development Strategy Institute.
Shanghai. At the spectacular, bamboo-themed Fosun Foundation.
And that’s when Mao Zedong’s legendary 1960s formulation of the US as a “paper tiger” – quoted in everything from Latin American guerrilla slogans to Godard movies – resurfaced with full force.
Wang Lihua picked up on what President Xi had told Putin at their landmark meeting at the Kremlin two years ago:
we are right in the middle of changes not seen in 100 years.
Wang: “This change cannot be changed all at once, and the trade war between China and the United States will not be resolved once and for all. This kind of friction and struggle, in the words of Chairman Mao, is ‘making trouble, failing, making trouble again, failing again, until destruction.’”
Wang wrapped up with what may encapsulate the general feeling in China, identified in every nook and cranny across Shanghai: “It is difficult for the United States to repair itself from within. Now the United States has to confront China and the whole world, and its strength is obviously not enough, so failure is inevitable. We are not afraid of a protracted war, because time is on our side.”
China “not afraid of war”, however it may manifest itself, from hybrid to hot, is the consensus feeling in Shanghai, borrowing from the Maoist concept of “united front”, and espoused from academics and business leaders to residents of “model quarters” of the Maoist era still impeccably preserved – and with an eye for innovation (example: row after row of a.c. outlets to feed the array of electric bikes parked in the internal patios).
The “Paper Tiger” Lashes Out
It was immensely enlightening to share business dinners with executives and sales people coming from several Chinese provinces – from the stunning Pei Mansion, one of the most beautiful early 20th century buildings in Shanghai, where star architect I.M. Pei lived for one year, to the best Xinjiang restaurant in town, Ali Yang, at the World Financial Center, complete with the full Uighur lamb experience.
In all conversations and debates, a constant: no illusions about Trump 2.0’s shifting strategy, and how it should be turned against him, Sun Tzu-style; how China must amass a solid set of bargaining chips; and most of all how, from the beginning, this was always a war of an elite section of the American ruling classes on China. The rest of the world is a sideshow.
So it’s no wonder that in every business dinner, after a matchless gastronomic feast, the conversation soon veered on how China’s strategy will not be about immediate damage control; and how China is already eyeing new links and nodes to deepen its long-term global competitiveness.
It’s an open question whether Trump 2.0 and his team of Sinophobes will manage to prevent the emergence of a Global Majority strategic alliance against the Empire of Chaos.
In Shanghai, and across China, submission is simply not an option. In cultural terms, Trump has managed to antagonize 1.4 billion Chinese, simultaneously, by treating the civilization-state without respect. The one thing that irks Chinese the most is mistreatment (see, for instance, the “century of humiliation”).
Shanghai. The view from my window on Jin Mao. No rare earths for barbarians.
A full-blown trade war? Deep decoupling? Bring it on.
The Emperor of Tariffs particularly hit Southeast Asia’s supply chains – Vietnam, Cambodia, Laos, Myanmar. For all ASEAN 10, their major trade partner is China. Chinese FDI is quite important in Cambodia and troubled, post-earthquake Myanmar. There’s no question ASEAN will have to act in a “strategically multilateral” manner.
President Xi’s timely tour of Vietnam, Cambodia and Malaysia is already setting the tone – corroborated by Foreign Minister Wang Yi: “South East Asia achieved a consensus: we will stand united and say no to these backward, regressive actions.”
Shanghai. Shanghai Tower from the Yu Garden.
The Trump Tariff Tizzy (TTT) is a war against BRICS and ASEAN – and the increasing presence of ASEAN within BRICS, as full members (Indonesia) and partners (Malaysia, Thailand, Vietnam). Top Chinese intellectuals are fully aware of it. Trump, for his part, considering his record, does not even know what BRICS and ASEAN actually mean.
At the BRICS preparatory sherpa meetings ahead of the summit in early July in Rio, there’s already serious movement to counteract the “unprecedented protectionism” of the Trump trade war, as formulated by the Brazilian Ministry of Agriculture. Trump has already issued a trademark threat: a 150% tariff on BRICS members. Top BRICS member China is not intimidated.
Busy Building a Global Consensus Against Bullying
Meanwhile in Beijing, in tandem with all the intellectual frenzy in Shanghai, Jensen Huang, the CEO of Nvidia, wearing a business suit (he prefers leather jackets) as a sign of respect and speaking in English (even though he was born in Taiwan) had a mega-significant meeting with Ren Hongbin, chairman of the China Council for the Promotion of International Trade (CCPIT).
So here we have the multi-billionaire CEO of an American chip behemoth telling the Chinese government, in person, that his company remains totally committed to the Chinese market, despite Trump 2.0’s stiff export restrictions on AI chips.
A new book, The Thinking Machine: Jensen Huang, Nvidia, and the World’s Most Coveted Microchip, is essential reading to understand how Huang thinks. He’s an Asian immigrant who came from poverty; personifies the old-school American dream; does not take any nonsense from anyone; and is hyper-competitive. Huang is fully aware that Nvidia simply cannot lose the Chinese market; moreover he knows that before 2030 Chinese engineers will release their own GPU and may put Nvidia out of business.
Back to Shanghai, flying out of Pudong Airport it was easy to see why China’s air passenger traffic hit a record high in the first quarter of 2025 – even in a climate of “crisis” and fierce competition, including high-speed rail. Compound it with the human tsunami taking over Nanjing Road on a Friday night; that necessitates rows and rows of military police to discipline the human flow on both sides of the pedestrian mall.
The Tariff Emperor is being relentlessly mocked all across China.
Consumer crisis? What crisis? In parallel, across the Pacific, Taobao is now number 2 – and counting – on Apple’s App store in the US; everyone is eager not only for viral TikTok videos, but to go on an unlimited shopping spree of affordable made in China products.
On the military front, China has just come up with a non-nuclear hydrogen bomb. No uranium, No plutonium. Just a matchless chemical/engineering compound solution. Declining Empires waging proxy wars are so last century. The new Chinese bomb weighs just 2 kg; lasts fifteen times longer than TNT; and its fireball exceeds 1000 degrees Celsius.
The key lesson of these past heady days in Shanghai may be that China is now firmly, strategically focused all across the planet to occupy the moral high ground.
Trump Tariff Tizzy (TTT) may not improve the American trade deficit; what’s clear is that it has already imploded American trustworthiness.
Moreover, China’s absolute priority goes way beyond global trade: everyone familiar with Xi Jinping Thought knows it’s all about achieving “national modernization”, unification and weaving, with partners in all continents, a “community of shared future”.
So geopolitically and geoeconomically, this is the road map ahead: Shanghai is showing that China is relishing its new role as a Resistance beacon, bent on defying bullying, busy building a Global Majority consensus. It’s all about strategic patience – which a chaotic Empire out of control simply does not have.
Paul and Ken assess the extent of China’s decoupling from the US and why the US is deeply fearful of the outcome of Beijing’s policy initiatives in this regard.
China will continue to to turn the screw.
Three wise monkeys are perfectly aware of what a pigeon posing as eagle is really up to.
By Pepe Escobar at the Strategic Culture Foundation.
The Toddler Temper Tantrum-style Trump Tariff Tizzy (TTT), now accelerated to 145% – and counting – is yet another thunderous trademark pigeon smashing the chessboard gambit.
It won’t work. Trump claimed that China would call him to “make a deal”. That’s reality show territory. Reality is more like the statement by the Customs Tariff Commission of the State Council: “Given that U.S. exports to China already have no market acceptability under the current tariff rates, if the U.S. further imposes additional tariffs on Chinese goods, China will simply ignore them.”
Translation: keep vociferating/tariffing. We don’t care. And we will stop buying from you. Anything.
The Chinese Foreign Ministry: A “tariff-wielding barbarian can never expect a call from China.”
Basic numbers. China’s GDP for 2025 is projected at 5%. U.S. imports account for at best 4% of Chinese GDP. China’s share of total exports to the U.S. dropped to 13.4 per cent in 2024.
Goldman Sachs – not exactly a CCP “mouthpiece” – has just projected that TTT will cost China only 0.5% of GDP in 2025, while costing no less than 2% of U.S. GDP. Talk about blowback.
Still, from now on, what matters most for Beijing is to keep diversifying the supply chain.
Asia-wide, the extra wheels are in motion. President Xi Jinping will soon start an ASEAN mini-tour (Vietnam, Cambodia, Malaysia). The Shanghai Cooperation Organization – increasingly focused on geoeconomics – is about to meet. The EU, for all the mendacity of its “elites”, is absolutely itching to strike trade deals with China.
Zhao Minghao, deputy director at the Centre for American Studies at Fudan University, in Shanghai, refers to the current incandescence as “a game of strategic resolve.”
Previously, the eminent Wang Yiwei, international relations star professor at Renmin University in Beijing and an expert on the New Silk Roads, noted that the current tariff rate already made China’s exports to the U.S. “almost impossible”.
This analysis noted how China started to deal with TTT with a “courtesy before force” approach, then turned to “we don’t care”, while cultivating “the art of timing” in its asymmetric attack on U.S. stocks.
A fascinating window on the real wheels of Chinese trade is offered by a timely visit to the vast Yiwu International Trade City, the largest concentration of small traders on the planet.
Less than 10% of Yiwu’s phenomenal amount of business involves the U.S. Among the 75,000 business operators in Yiwu Small Commodity City, only a little over 3,000 do business with the U.S.
Two Sinophobes meet one mirage
TTT is largely the product of two crude Team Trump arrogant/ignorant Sinophobes, economic advisor Peter Navarro and Secretary of the Treasury Scott Bessent, who know less than zero about all things China.
In fact it was Bessent who right at the start gave the game away:
“This was driven by the president’s strategy… You might even say that he goaded China into a bad position. They responded. They have shown themselves to the world to be the bad actors, and we are willing to cooperate with our allies and with our trading partners who did not retaliate.”
A crude trap. With the sole focus on China. That had nothing to do with the initial tawdry plot line: tariffs, Mafia-style, on most of the planet, penguins included. If you don’t retaliate, fine. If you do, we hit harder.
of the so-called “Miran mirage” – after Trump’s alleged economic brain Stephen Miran. What is actually happening, fast, bypassing the stupid notion that tariffs will be paid for by current depreciation elsewhere (see Miran’s white paper here), is the uncontrolled demolition of the U.S. as a world trade center.
Asked why he paused the tariffs, Trump answered: “I thought people were jumping a bit out of line. They were getting a little bit yipee. They were getting afraid.”
Nonsense. Trump cannot possibly admit on the record that the U.S. oligarchy, Jamie Dimon and co., freaked out big time; and that, plus the debacle in the bond market, forced him to backtrack.
Nobody in neoliberal heaven and earth can mess with the Goddess of the Market.
As for the long-term strategy of several nations of the Global Majority caught in TTT’s crossfire hurricane, not to mention big players like China and the EU, they will all avidly reduce their dependence on U.S. markets.
Once again, the elaborate “deal” offered by Trump and his illiterate advisors boiled down to a Mafioso “offer you can’t refuse”: blow up, or significantly diminish, your trade with China – the largest trading partner of nearly all of these nations – and trade with Exceptionalistan, plus 10% tariffs. To hell with your economic sovereignty and strategic flexibility. Once again: it’s our way or the – tariff – highway.
Reality instead will dictate that the U.S. will increasingly import Chinese products from third countries – while China will continue to get paid for it. China will export even more to ASEAN and other Global Majority actors.
As it stands, Trump’s “plan” – if there is any – remains to “stabilize” his allies while concentrating all the firepower on China, in theory to drive China’s complex supply chains to chaos and force companies to move production lines to, for example, Vietnam or India.
Shakedown leading to breakdown
China containment will be on overdrive. Expect a tsunami of technological restrictions, investment red lines and, of course, extra sanctions. Sinophobe Bessent does not rule out delisting Chinese stocks from U.S. exchanges: “I think everything’s on the table (…) That will be President Trump’s decision.”
Beijing, for its part, can easily go nuclear, deciding for a sell-off of its U.S. Treasuries en masse, with catastrophic cascading consequences. As of January, Beijing held $760 billion in U.S. debt. With a delightful diplomatic touch, Yang Panpan and Xu Qiuyan, researchers at the Chinese Academy of Social Sciences, note that what happens next with U.S. Treasury bonds remains “highly uncertain”.
Bridgewater billionaire investor Ray Dalio, for his part, while incisive, was also heavy on diplomacy: “We are seeing a classic breakdown of the major monetary, political and geopolitical orders.”
There’s no more “cooperative world order” led by the U.S. (in fact that was anything but cooperative”); Dalio at least recognizes the unilateralism manifest in “the U.S.-led trade-war, geopolitical war, technology war, and, in some cases, military wars.”
Chinese Foreign Ministry Spokesperson Lin Jian de facto synthesized Beijing’s position. No more Mr. Nice Guy, which was the default Chinese position until recently: if the U.S. insists on fighting a tariff war and a trade war, China will fight to the end.
So here we are. And once again, it’s the Empire of Chaos against BRICS.
The Empire of Chaos embarks on a hot geoeconomics war against its peer competitor China; contemplates a hot military war against sovereign Iran; and at the same time tries to appease nuclear/hypersonic power Russia into a sort of hazy deal to somewhat freeze the Forever War by proxy in Ukraine.
The new Primakov triangle, RIC (Russia-Iran-China) is perfectly aware of these moves. Putin had metaphorically characterized the Russian position in the U.S.-China trade war when he mentioned that the Chinese have a good proverb: when tigers fight in the valley, the smart monkey sits and watches how it ends.
Now is more the case of three wise monkeys perfectly aware of what a pigeon posing as eagle is really up to.
Global Majority, rejoice! And step on the high-speed rail de-dollarization train.
By Pepe Escobar at the Strategic Culture Foundation.
Circus ringmaster Trump’s Tariff Tizzy (TTT), christened by himself as “Liberation Day”, is being largely interpreted around the world – Global North and Global South alike – as Slaughterhouse Day.
This de facto uncontrolled economic demolition gambit starts with the warped fantasy that launching a customs war on China is a bright idea. As bright as collecting a few trillion extra dollars in tariffs assuming the rest of the planet will be somewhat “encouraged” to sell to the Hegemon, while pretending that these tariffs will lead to the re-industrialization of the U.S.
The tragicomic mask of a self-appointed circus ringmaster of turbo-capitalism may be as pathetic as the European chihuahua rage boosting their “revenge” via Rearmament – with funds that they plan to steal from the savings accounts of unsuspecting citizens.
The indispensable Michael Hudson has configured the key problem. Allow me a little tweak: “Sanctions and threats are the only thing that the United States has left. It no longer can offer other countries a win-win situation, and Trump has said that America has to be the net gainer in any international deal it’s made, whether it’s a financial deal or a trade deal. And if America is saying, any deal we make, you lose, I win”, that Mafia extorsion gambit does not exactly reflect the Art of the Deal.
Prof. Hudson neatly describes Trump’s negotiation tactics: “When you don’t have very much to offer economically, all you can do is offer not to hurt other countries, not to sanction them, not to do something that will be against their interest.” Now, with TTT, Trump is actually “offering” to hurt them all. And they will certainly invest in all sorts of counter-tactics to “get away” from that “strategy” of American “diplomacy”.
A trade war on Asia
TTT attacks everyone, especially the EU (“born to hurt us”, according to the circus ringmaster. Wrong, because the EU was invented by the Americans in 1957 to actually keep Europe under control). The EU exports roughly 503 billion euros to the U.S. a year, while importing around 347 billion. Trump is fuming non-stop about this surplus.
So a counter-measure vendetta will be inevitably in store, as already advertised by the toxic Medusa von der Lugen in Brussels – incidentally the sponsor of every weapons producer in Europe.
Yet TTT is above all a trade war on Asia. “Reciprocal” tariffs – not exactly reciprocal – were imposed on China (34%),Vietnam (46%), India (26%), Indonesia (32%), Cambodia (49%), Malaysia (24%), South Korea (25%), Thailand (36%), earthquake-hit Myanmar (44%), Taiwan (32%) and Japan (24%).
Well, even before TTT, a first has been achieved: the circus ringmaster generated a once-in-a-lifetime consensus among China, Japan and South Korea that their response will be coordinated.
Japan and South Korea will import semiconductor raw materials from China, while China will be purchasing chips from Japan and South Korea. Translation: TTT will solidify “supply chain cooperation” among this triad that so far was not exactly too cooperative.
What the circus ringmaster really wants is an iron-clad mechanism – already being developed by his team – that unilaterally imposes whatever level of tariffs Trump may come up with on whatever excuse: could be to circumvent “currency manipulation”, to counter a value-added tax, on “security grounds”, whatever. And to hell with international law. For all practical purposes, Trump is burying the WTO.
Even tariffed penguins in Heard island in the South Pacific know that the certified effects of TTT will include rising inflation in the U.S., serious pain on its – delocalized – corporations and most of all the complete collapse of American “credibility” as a reliable and trustworthy trading partner, adding to its certified reputation as “non-agreement capable” – as the Global South knows so well. > Ант: A rentier FIRE Empire (financialization, insurance, real estate, as masterfully analyzed by Michael Hudson), which offshored its manufacturing industries and was gobbled up by a pile of overleveraged hedge funds, Wall Street derivatives and Silicon Valley totalitarian surveillance in the end decides to strike…itself.
Poetic justice applies. Burning Down the House – from inside the house. As for the emerging, sovereign Global Majority, rejoice: and step on the high-speed rail de-dollarization train.
Lateo.net - Flux RSS en pagaille (pour en ajouter : @ moi) 