SINOLOGIX provides economic, technological, and political analysis of the People’s Republic of China and its burgeoning portfolio of partners in the so-called Global South. We strive to offer objective, independent research – and while objective doesn’t necessarily preclude an editorial point-of-view, we endeavor to provide a balanced perspective so that our readers can better understand the opportunities, risks, and challenges when engaging China and its collective partners. To that end, we publish content from contributing subject matter experts, even if we do not necessarily endorse their points of view.
NOTE – our readers may have observed a shift in our focus on all things Chinese to a more expansive scope as we incorporate conflicts in the Mideast and Central Asia, we as economic and political developments related to the so-called Global South – China is rapidly emerging as an influential leader in regions where the US and its allies once dominated without challenge. China’s emergence as a superpower equal to the US is perhaps best observed in the context of global events.
Featured research on mainland China, APAC, and Central Asia by SINOLOGIX staff and contributing subject matter experts.
Recent news coverage in western media suggests that US sanctions against China’s semiconductor sector have caught the CCP and mainland industry leaders off guard. In this research article, we examine this issue in the context of the global supply chain to analyze the short-term and long-term impact of US sanctions and the implications for both China and key industry players.
In less than six months, the Russo-Ukrainian War has degenerated into one of the most devastating conflicts in modern history – how is it possible that this debacle was allowed to happen? Without an understanding of the conflict’s true cause, it will be difficult, if not impossible, to negotiate a settlement that is acceptable not only to Russia and Ukraine but also to the many secondary parties that are using them as proxies, including the US and NATO. While China has officially maintained a neutral position on the Ukrainian conflict, it clearly has a vested interest in the outcome, particularly as it pertains to the Taiwan question.
To put China’s massive pollution problem in perspective, it’s important to understand that China’s transition from an agricultural to an industrial economy happened over a span of less than 40 years. While the US and other western countries gradually adapted to industrialization over a 150-year span, China has had to deal with industrialization over a much shorter period and at a scale that dwarfs that of the US.
China is both the world’s largest producer of greenhouse gas emissions (GGEs) and the world’s largest producer of renewable energy. From a climate change perspective, China is the 800-pound gorilla in the room – no matter what the rest of the world does in terms of GGEs, as China goes, so goes planet Earth. If China fails to reign in GGEs, catastrophic climate change may be inevitable.
Recent news coverage in western media suggests that US sanctions against China’s semiconductor sector have caught the CCP and mainland industry leaders off guard. In this Part 2 of our two-part series on China’s semiconductor market, we do a deep(er) dive on the mainland Chinese chip sector, examine the Chinese government’s strategic plan to decouple China’s reliance on western technology suppliers, and evaluate the outcomes of that strategy.
As the multi-polar Global South movement accelerates, there is now a consensus that the time is right for strategic alternatives – banks, financial messaging systems, and possibly even a new currency. In this Part 03, we examine recent changes to the financial infrastructure proliferating amongst BRICS+ and SCO+ members.
The contrast between the debt-to-GDP ratio for China andrussia vs. Japan and the US is yet another stark reminder that economic power is shifting away from the traditional g7 countires to the BRICS – notwithstanding questions regarding the accuracy of China’s numbers, it should be clear that both China and Russia are ina much stronger position to continue their economic growth, while both japan and the US have maxed out their credit cards.
In 2022, the US government will pay $305B in interest (to service the national debt) – roughly 5% of the total federal budget. By 2030, that number is expected to grow to $829B, or roughly 10.6% of the total federal budget. Note – this estimate was calculated before the 2022 adjustments to the Fed funds target rate.
Japan and the US are going to find it increasingly diffiuclt to find buyers for JGB and US Treasuries – and that is going to have a profound impact on the value of their respective currencies. China and Russia, on the other hand, have initiated two initiatives that will further erode the US control of global trade – commodity-based currencies and trade settlement using a basket of currencies (other than the USD).
Data Source – World Bank
Data Source – World Bank
Data Source – World Bank
PLEASE NOTE – We’re in the process of developing a full Retrieval Augmented Generation (RAG) component that will tap into a database of economic, tech trends and other data associated with our research reports. This initial prototype includes content that we’ve already published in the form of text articles, but we’ll soon be adding structured content that will enable in-depth analysis not generally available through public chat apps.
Retrieval Augment Generation refers to generative AI that is supplemented with proprietary structured data, text, images, audio and video content that we have curated from our research.
Thanks for your patience! This initial prototype will soon be replaced with a more advanced UI capable of generating complete multi-modal reports. Please bear with us – this prototype is text and speech only.
Data Source – World Bank
Data Source – World Bank
Data Source – World Bank
Western media is starting to pay attention to China’s efforts to influence members of the so-called Global South, or more specifically the BRICS+ and Shanghai Cooperation Organization (with substantially overlapping membership), to denominate international trade in the Chinese Renminbi (RMB), aks the Chinese Yuan (CNY) and/or other local currencies. For very different reasons, Russia has promoted the idea of an entirely new currency for trade settlement. This is an accelerating trend among countries that have formed close economic and political relationships with China.
Coincident with the pivot to the RMB for trade settlement is a growing sentiment among the BRICS+ and SCO members that holding USD as their primary reserve currency poses a risk in the event the US declares sanctions and/or freezes a country’s assets, as happened with Russia and Belarus in 2022.
The combined effect of these two trends should be observable in a country’s US Treasuries holdings, and that’s exactly what we’re seeing in the chart above – China’s USD and Treasuries holdings peaked at $1.277 trillion in 2013 and declined by more than 32% in 2022.
Things change “slowly at first, then all at once”...
The so-called “de-dollarization” phenomenon is really a reflection of China’s ascendancy to superpower status – there can be no question it is the main driver behind the emergence of increasingly powerful inter-regional economic organizations, innovative trade agreements that circumvent the USD’s role as the world’s primary currency for trade settlement, and conceivably, the demise of the USD as the world’s de facto reserve currency. In this Part 1, we summarize the key factors that might trigger a future change in currency usage by China and its trading partners.
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While not as closely watched as the recent summit in Moscow, where President Xi tacitly threw his weight behind Russia and its SMO in Ukraine, Brazil’s newly (re)elected President Lula da Silva’s recent state visit to China was in many respects much more significant, as it further pulls the US’ most powerful Latin American ally away from its sphere of influence and into China’s orbit.
While China is a driving force in the Global South’s pivot away from the USD, the rapid expansion of inter-regional economic organizations made up of Asian, Central Asian, Middle East, African and Latin American countries has accelerated the shift in political and economic power that threatens to upend more than 70 years of US dominance on the world stage.
The so-called “de-dollarization” phenomenon is really a reflection of China’s ascendancy to superpower status – there can be no question it is the main driver behind the emergence of increasingly powerful inter-regional economic organizations, innovative trade agreements that circumvent the USD’s role as the world’s primary currency for trade settlement, and conceivably, the demise of the USD as the world’s de facto reserve currency. In this Part 1, we summarize the key factors that might trigger a future change in currency usage by China and its trading partners.
On March 22, China’s President Xi Jinping concluded a very visible state visit to Moscow, where he met for three days of discussions with Russia’s President Vladimir Putin on a number of topics of interest not only to both China and Russia, but the US and its EU allies as well.
In a historic turn of events, China has successfully brokered a groundbreaking agreement between long-standing rivals Saudi Arabia and Iran, marking a significant shift in the geopolitical landscape of the Middle East. The agreement, which focuses on reestablishing diplomatic ties, ending proxy conflicts, and enhancing economic cooperation, highlights China’s growing influence in the region and its expanding role as a global power.
The last few weeks have seen remarkable changes in China – the (reported) COVID numbers have stabilized and even declined in some provinces, 2022 Q4 GDP numbers (vastly) exceeded analysts’ expectations, a projected 5.2% GDP growth target for 2023 is driving demand for oil, and the latest Bureau of Statistics reports confirm a population decline. A lot to digest…
To put China’s massive pollution problem in perspective, it’s important to understand that China’s transition from an agricultural to an industrial economy happened over a span of less than 40 years. While the US and other western countries gradually adapted to industrialization over a 150-year span, China has had to deal with industrialization over a much shorter period and at a scale that dwarfs that of the US.
As the multi-polar Global South movement accelerates, there is now a consensus that the time is right for strategic alternatives – banks, financial messaging systems, and possibly even a new currency. In this Part 03, we examine recent changes to the financial infrastructure proliferating amongst BRICS+ and SCO+ members.
While not as closely watched as the recent summit in Moscow, where President Xi tacitly threw his weight behind Russia and its SMO in Ukraine, Brazil’s newly (re)elected President Lula da Silva’s recent state visit to China was in many respects much more significant, as it further pulls the US’ most powerful Latin American ally away from its sphere of influence and into China’s orbit.
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Due to the recent COVID outbreak in the downtown Puxi District, the Shanghai office is closed to outside visitors. Please feel free to contact us via email or phone to schedule an online meeting.
Due to the recent COVID outbreak in the downtown Puxi District, the Shanghai office is closed to outside visitors. Please feel free to contact us via email or phone to schedule an online meeting.
Due to the recent COVID outbreak in the downtown Puxi District, the Shanghai office is closed to outside visitors. Please feel free to contact us via email or phone to schedule an online meeting.
Due to the recent COVID outbreak in the downtown Puxi District, the Shanghai office is closed to outside visitors. Please feel free to contact us via email or phone to schedule an online meeting.
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