Something is going on. there is a lot of reform – for example of state owned enterprises, financial management, digital currencies, new tariffs.
So the emphasis is on the New Era. This is a New Era that is a new one after the Reform and Opening Up Era is, or has, ended.
So what is the difference between Reform and Opening Up and Socialism with Chinese Characteristics for a New Era.
Three things are clear:
- The Party is in charge of the system to deliver the new China by 2049 with an important staging date of 2035. That covers Party Committees and the leadership of larger parts of the Private Sector. This is an era of managed capitalism, responsible capitalism combining with creating a shared society of a socialist form.
- The demand for the Chinese economy has moved substantially to the domestic demand. A higher RMB rate is consistent with that. A digital currency will expand the Chinese in the world currency markets. Rising gold is also good for China – and India – who have both been the major buyers of gold for more than 10 years.
- The role of BRI nations in the Chinese economy is expanding and will gradually rise to over 50pc in trade and investment and in overall terms.
All of these and many more are worthy of deep study. The article below is like the article on the recent Fourth Plenum. We cannot understand these moves as they are hardly discussed in Western media or blogs. We really need Chatham House to establish a serious working group to understand what China is trying to do and how would we know if it is happening. The West missed Reform and Opening Up. We will miss the new era as well.
One thing is for sure a completely new kind of Socialism is being built in China and it has deep defences against disruption. My sense is that it is full of opportunities for the UK and/or Europe. There are, once again, real first move opportunities here.
I sense that the USA might lock itself out of the new possibilities if it continues to fight for a trade balance. That will be achieved over 5 years but with a shrinking total trade level, unless the USA will provide China with what it needs.
One gets the sense that if the USA is too tough on China in a second phase they may really lose their China market.
What does it mean for business and nations? China is changing again and its effect will stretch Western nations and Businesses. But it is going to provide many opportunities. We need Dominic Cummings to create a China Research Group to dispassionately comprehend what China is doing, the effects it may have, and what strategies to employ in relation to Nations and Companies.
For those who need to work it out on their own, not simple with all this media hype.