Does China have problems? For sure. The Chinese know it and the world knows it. Are these problems threatening the structure and fabric of China? No.
Is “De-Coupling” working? Is the world shunning China, isolating China, hurting China? Facts suggest, again, a firm No.
China’s benchmark CSI 300 index is up 27% in 2020. China’s bond market has been a big draw for investors following China’s decisive response to the Covid-19 outbreak. Foreign holdings of Chinese government debt grew by more than RMB900bn in first 11 months of 2020. Pent up demand among global investors turning away from US dollar is keeping the RMB firm. Net foreign purchases of Chinese equities through HK is up to $26bn this year. Despite Trump’s machinations on trade, tariffs and Chinese government personnel, China has received total inflows of $620bn in his four years in power.
China is here to stay. The Party is here to stay. China will continue to recover from the pandemic and will continue to be a growing major power in world economic and political affairs.
