South and Central America also bending the knee to Chinese interests.
Like a stinky skunk, China is spreading its smelly intentions all over Asia and the world.
An example of this is the Regional Comprehensive Economic Association, which is supposed to be the largest trade agreement in the world.
It was signed on November 15 between 15 countries, including the heavyweights of Asia: China, Japan, South Korea and Australia and others.
This treaty, which brings together a third of the planet’s wealth and trade, aims to promote the opening of trade in this area… to China.
China’s bait is nothing less than offering zero tariffs to 90% of the goods that will move around most of the eastern hemisphere.
According to the Brookings Institution, this agreement will increase trade by 10% compared to previous levels and countries such as Japan or South Korea would increase their GDP by several tenths of a percent.
While most of Asia lives from crumbs, China will restart its coal plants in an attempt to take over the world’s economy. It was a very well calculated move. First, the Chinese released the virus, then the global economy all but collapsed, and now, they are restarting their engines to gain even more control of national economies.
China is the only major economy to grow this year. Thanks to RCEP, the rest of the countries will be able to export more to Beijing by taking advantage of its demand, and, in turn, the Chinese regime will also be able to use the treaty to relocate its production chains to emerging countries –AKA cheap labor- as its costs have increased in recent years– and import intermediate products from its neighboring countries at lower costs.
But Chinese ambitions go much further. The RCEP agreement is not all that it was sold as by the Chinese dictatorship. For example, many of the tariff reductions that it promises were already present.
It is a new agreement. It is not the content itself that matters, but the signal it represents. It is the first truly regional treaty, between Asians. Although it has holes, at a time when the world is closing in on itself, it has a very important political symbolism. Asia has understood that it is not convenient for the continent to lock itself up.
Integration in Asia still has many more barriers, insofar as its members are in a different phase of their development, with very different languages, very different institutional and religious schemes, but those have never represented barriers to Chinese dreams of dominance.
The treaty is a message of support from China and Asia to the new world order. It also aims to develop value chains halted during COVID and reinforces the decoupling between China and the US.
We are, therefore, before a political strategy at the service of a large-scale economic development plan. China accounts for about 16% of world GDP, according to World Bank data, and is expected to become the leading power within a decade. Consolidating its business dominance in Asia is just the first step in a broader strategy.
The fact that China’s latest intentions are fulfilled more or less strictly matters less than the direction of their evolution, which has been a continues upward movement.
From this perspective, Beijing is now considering giving a tighter spin to the screw. A few days ago, Chinese leader Xi Jinping said that China could study the possibility of becoming part of the CPTPP, the successor of the controversial TPP, a trade agreement that brings together Asian and South American countries from the other ocean shore, the same treaty that Obama administration promoted to exclude China. Trump has, to his credit, abandoned it
The Pacific treaty provides for tariffs lower than the RCEP -2.7%-, which has more economic significance. Xi Jinping goes on to say that he could enter into the agreement designed to kick him out.
In reality, China wants to mark its territory, like a stinky skunk. This does not go unnoticed and with Biden having been indirectly elected by Beijing, the so-called trade war will most likely be coming to an end soon.
Ending conflict with China is something that the Washington DC swamp supports strongly. Currently, China represents the greatest threat to the US and democracy and freedom worldwide since World War II.
Beijing seeks to dominate the United States, as well as the rest of the planet, economically, militarily and technologically,” warned John Ratcliffe, director of National Intelligence of the United States.
Whether it is true or not, for Xi Jinping, economic leadership is achieved by joining trade agreements, especially if you are the bully on the playground. China does not have to worry about including environmental protection, human or labor rights in its new trade agreement, so there is no limit to what it can do.
But for China it is also the way to avoid the suppression of firms such as Huawei or TikTok when these companies carry their businesses abroad. Beijing is now studying how to extend its dominance; first in Asia and Latin America and then Europe and the western hemisphere.