Former Chinese official says China needs to brace itself in the midst of a “financial war” and expected rate cuts by the US Federal Reserve will draw huge amounts of money back to China, sparking new turmoil within China I warned you that this is a possibility. Domestic financial market.
“We must stop large-scale malicious speculation to expropriate China’s high-quality assets and assets. [the injection of US capital] It's causing problems for China's stock market,” said Chen Wenlin, chief economist at the Beijing-based China Center for International Economic Exchanges, a government-run think tank.
Chen, who worked as a senior official at the State Council Investigation Office from 1999 to 2010, made the comments in an interview with news portal Guancha.cn this week.
Beijing slams US assessment of China's 'predatory' economy as 'smear tactic'
Beijing slams US assessment of China's 'predatory' economy as 'smear tactic'
Nevertheless, interest rate trends are likely to draw foreign investors back to China, and Chen expects the world's second-largest economy to be boosted by more active capital markets this year.
However, Chen said China should remain cautious as it remains at a disadvantage in financial competition with the United States.
“[We are] It’s always in a state of containment, repression, and harvest,” she said. “The position of the US dollar is still there, and the power of the United States is still there. Any increase or decrease in interest rates by the Federal Reserve will have an impact on us.”
Mr. Chen said foreign investors' withdrawal from China over the past year was evidence of a “financial war” and that their bearish sentiments towards China were the result of a “war of public opinion”, adding that Hong Kong He also stated that it was necessary to strengthen the position of financial center.
He noted that ensuring the safety of assets of Chinese companies listed in the United States should be another priority for the Chinese government in the financial dispute between the two countries.
The US government has asked Chinese companies to delist from the New York Stock Exchange, and has pointed out that five Chinese state-owned enterprises, including energy and chemical giants PetroChina and Sinopec, will be delisted in 2022.
And he warned, without naming names, that even more companies could be forced to delist depending on who is elected after the U.S. presidential election later this year.
But while some US-based researchers acknowledge that financial decoupling is a lingering threat facing the two economic superpowers, they say it is an overstatement to characterize the situation as a “financial war.” Says.
Yang Liang, head of the economics department at Willamette University in Oregon, US, said that “financial stability is one of our priorities,'' and that some people in China are using the National People's Congress as an excuse to advance the idea of a financial war. He said there may be.
Chinese leaders prioritize economic stability, investor confidence in 2024
Chinese leaders prioritize economic stability, investor confidence in 2024
“Some people are afraid of financial sector liberalization,” Yang said. “There are many scholars in China who oppose liberalization.” [nation’s] This could allow US dollar holders to “grab our assets.” ”
He added that “financial decoupling”, including restricting the other party's stock market listing, is possible.
Kerr Gibbs, former president of the American Chamber of Commerce in Shanghai and now resident at the University of San Francisco, said the Chinese government is already in the financial He said the system is being adjusted. Mainland China and Taiwan.
“That's what's happening now and it's going to accelerate,” he said.
James Chin, professor of Asian studies at the University of Tasmania, said the separation between the two major financial markets would pose challenges.
“One of the lessons we learned was; [from the Ukraine-Russia war] “It's not that easy to separate the country,” he said.
