Newsletter 144 - December 11, 2022
Welcome to the 144th edition of Trade War.
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China’s abrupt end to Covid Zero is sure to spark a health crisis as well as further damage the economy in the shorter-term. While the protests that rocked cities and universities helped speed the reversal of pandemic controls, economic woes likely played a much larger role. And Foxconn founder Terry Gou warned officials in a letter that continued lockdowns could hurt China’s key role in global supply chains.
Goldman Sachs adds ten more years to its prediction of when China will surpass the U.S. economically, now saying it will happen in 2035. Kurt Campbell says a beleaguered Beijing is ready to cooperate with Washington for the “short term.” Even though some see signs of a “charm offensive,” don’t expect China to give up its wolf warrior ways. And Xi Jinping signs oil and gas deals in a visit to Saudi Arabia where “non-interference” in domestic affairs is stressed by both Beijing and Riyadh.
TSMC founder Morris Chang says “globalization is almost dead” at ceremony heralding his company’s $40 billion investment in semiconductor production in Arizona. And despite signs of compromise in the ongoing chip war between the U.S. and China, don’t expect the clash for technological supremacy to be seriously dialed down.
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