Trade War
Welcome to the 208th edition of Trade War
First, an important notice: Trade War will be on hiatus for the rest of the month as I take a long-awaited trip. Look out for some special coverage when Trade War returns at the beginning of May.
On to the news ~
Longtime China bull rails about “neutered” nature of recent China Development Forum. Treasury Secretary Yellen warns about overproduction during China visit but says bilateral relationship is now on a “more stable footing,” after meetings with top officials.
A flood of cheap exports could lead to a new China shock. And excess capacity also driven by Beijing’s political campaigns, not just lax budget constraints.
Electric vehicle maker BYD powers past Geely as new auto champion. And while China’s EVs compete in almost every segment, other countries only have premium models.
Plus more—
Chinese director Wang Xiaoshuai laments censorship in film industry calling atmosphere “increasingly depressing and cautious” (with bonus link to my 2005 interview with Wang)
China’s families spend 7.9 percent of household expenditures on education, higher than any other country
And the bizarre murder behind the making of ‘3 Body Problem”
Somebody had a bad CDF …
“The [China Development Forum] has effectively been neutered as an open and honest platform of engagement,” rails Yale University economist Stephen Roach who has attended every CDF but one, since its founding in 2000. That makes him, as he writes, “the longest-attending foreign delegate to China’s most important public conference.”
“Word has been sent down from on high that there is room for only ‘the good stories of China.’ Anyone who raises questions about problems, or even challenges, faces exclusion from the public sessions,” writes Roach.
“I went to CDF 2024 with the idealistic hope that the flames of the original spirit of this event were still flickering . . . Notwithstanding ever tighter efforts at information control, I harbored the admittedly naïve view that there was still room for analytically grounded, empirically supported research. After all, I had long been viewed as a ‘good friend of China.’ My error was to presume that my special relationship gave me license to raise tough questions.”
For years the well-connected Roach had a reputation as a China bull and regularly pooh-poohed foreign press coverage as overly negative of China. I remember a dinner meeting in Beijing that he hosted with maybe five or six of of us foreign correspondents in the late ‘90s, when he was Morgan Stanley’s chief economist.
Over fine food in a high-end hotel, we all joined in a spirited conversation on the direction of China’s economy. But in a blog post he wrote later, he accused us of being unreasonably bearish and concluded that we had come to China with overly idealistic views; our disappointment when China didn’t live up our rosy expectations had soured us and affected our coverage, he concluded. Needless to say, we didn’t agree.
US Treasury’s Yellen: China overproduction a major concern
Overproduction by Chinese companies is a top concern for the U.S., as is unfair treatment of American firms, Treasury Secretary Janet Yellen said in meetings with Chinese Vice Premier He Lifeng in Guangzhou. Beijing for its part expressed “grave concerns” over U.S. export curbs on Chinese companies, reported China’s official news agency.
“I think the Chinese realize how concerned we are about the implications of their industrial strategy for the United States, for the potential to flood our markets with exports that make it difficult for American firms to compete,” Yellen told journalists on Saturday.
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