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The decoupling of the American and Chinese economies is accelerating

The partial agreement announced Friday between China and the United States marks a truce in the trade war. But behind the scenes, decoupling is at work: the two great powers are continuing their efforts to unravel the ties that unite their economies.

The decoupling of Chinese and American economies, the word has been buzzing for several months. This is the thesis supported by all those who are convinced that the interest of States and their sovereignist vision are outweighing the interest of business. China was the first to implement it by prioritizing its interests over the opening of its market, some say, while others accuse President Trump of having led the United States in this way by triggering the trade war. The fact is that the two great powers are now working hard to no longer depend on each other. The stakes are very sensitive in the field of high technology

Is the technology gap widening between the two countries ?

Beijing announced a few days ago that its entire administration will be fully equipped with Chinese software by 2022, marking the step towards the digital sovereignty that China has cultivated for years. The Chinese have never wanted Google and Facebook likely to spread the virus of free information and have developed their own tools to do without GAFA. They are today at the forefront of research on the blockchain technology that made the success of bitcoin . Long before the other major central banks, Beijing is preparing to launch the first tests for its digital currency, which has been under study for five years. Seeing their technological supremacy falter, the Americans have become hyper defensive. Very vigilant on imports or exports of potentially threatening materials. As with investments, especially Chinese, in the high-tech sector. This is how Huawei became a persona non grata entity on American soil.

Is this national downturn compatible with the growth of businesses ?

The answer is rather negative for both countries. American side, with Apple for example. The company needs Chinese factories to produce its phones, it has not yet repatriated its workshops on American soil as in Donald Trump's dream, it would eat up too much profits and Apple also needs Chinese outlets, the Middle Kingdom is its second market. On the Chinese side, there is a real political will to get rid of external dependence, but we are still very far from the account. Chinese imports of new technologies are six times larger than exports - according to the Mac Kinsey report on China and the world published in June 2019, and a third of these imports still come from the United States. Huawei seeks to secure its semiconductor supply in China, but it remains a world-class company that needs foreign markets.

What are the consequences for Europe ?

Europe is in the process of arming itself in order to no longer undergo the expansionism of the two great economic powers, but being weaker politically, almost absent from the sector of new technologies, it is already paying the price for the limits of decoupling: because if China and the United States certainly want to become more self-sufficient, they still need foreign outlets. Donald Trump multiplies the reprisals against the Europeans who defend their industry, aeronautics for example and lo and behold, Beijing is in turn more aggressive. This weekend the Chinese ambassador to Germany threatened German car manufacturers if Huawei were to be excluded from German 5G.

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