How much greater has Trump made the USA during his
Presidency from 2016 to 2020? Did the trade war result in USA's
re-industrialization and the ability to decouple completely from China?
In fact, the USA had imported more from China after Trump's trade war
effort and was greater than ever before. Was the USA able to produce
most of the items itself or source uncompetitively from elsewhere like
the EU? The only stuff they are able to produce are toilet papers to
export its inflation overseas.
When decoupling becomes
unworkable, they invented 'de-risking'. How to de-risk when China is
still in control of essential raw materials needed for USA's military,
plane makers, semiconductor manufacturing, pharmaceutical industry and
consumer products?
China had just issued new control over
Antimony, a flame retardant, needed for the USA military, citing 'dual
use' security issues, the new narrative invented by the USA which China
is following suit, tit for tat. China is not playing all its cards at
once and China has all the cards hidden close to its chest that it can
use to retaliate. The control of Gallium and Geranium exports by China
stunted the semiconductor manufacturing building frenzy in Arizona and
is killing the Chips Alliance. Wonder how the extraction by the USA and
the West to strip such rare metals from discarded laptops and other
electronic devices is progressing and how competitive will that be to
counter China.
Many plans to open up rare earth mines elsewhere
have failed. The USA thought that extracting rare earths from Mongolia
in a joint venture will counter China's control of Gallium and Geranium.
But China killed it straight away by disallowing the use of its Tianjin
Port for use by Mongolia to ship the ores to Japan for refining.
Setting up refining facilities in Mongolia is costly and takes years and
expertise that Mongolia lacks. Moreover, China can still kill such
competing ventures by cutting prices that will bankrupt the investors.
Are they willing to undertake such risks?
What was the fear
actually over China's overcapacity citing the fate of others around the
world? China's control over refining capacities in every sector will put
investors trying to set up competitive logistics in grave doubt over
investment feasibility. That is what the USA is trying to put a stop to.
The USA cares little about the fate of other countries trying to
compete with China. Most countries are not competing with China as China
is already providing them with products so cheaply that they do not
find it sensible to produce themselves. The economies of scale and
comparative advantage of production does not accrue to small countries.
Why should they be bothered with China's overcapacity?
It is the
same imaginary fear mongering over threats to small countries so that
they need the USA to place military bases for such countries'
protection. The Africans no longer buy into the snake oil.
Anonymous