GOOD MORNING FROM LONDON
A note to inform readers that tomorrow’s post will be More On Ukraine.
Today the FT reports that all but one of the global investment Banks returned a profit in 2021 in China following the further loosening of market controls by Beijing which allowed the Banks to take full control of their own operations in the PRC. Morgan Stanley made a profit of $4.5m following losses of $38m in the preceding three years + JP Morgan made a profit of $11m following losses of $39m in the previous two years.
Operational difficulties are lessening – so, too, are the number of restrictions imposed by the authorities in China.
The “getting to know” process is coming to an end. China is stepping back from over-zealous supervision + the US Banks are learning how to work in China. But China has always said it needed time to adjust to its far-reaching policy of Opening-Up. The process commenced in 1979 when Deng Hsiaoping announced the Reform policy in China where, just three years earlier, the country was in the vice-like grip of Left politics under the slogan “The Working Class Must Exercise Leadership Everywhere”.
This is happening as Washington continues to urge a clipping of China’s wings – popularly known as “De-Coupling”. But as this column has often said Governments have one set of priorities and Business has their own set of priorities. US Inc moves forward to different drumbeats.
This is a reflection of the one dominating geopolitical international issue – the change in the balance of power. Today is 2022 and the pace of change is significant but how different will the world be in 2032, 2052 or 2072? This is why the rise of the 1949 Sick Man of Asia is of such relevance. This is not a question of personal preference or backing one side against another. It is a cool-headed objective analysis. History is the Present as well as the Past.