As the Chinese economy, and it’s State controlled financial institutions brace against the COVID-juiced headwinds, certain all important outward facing policy and administrative arms are forced to make adjustments to policy settings. Some argue that the adjustments are part of a concerted public relations effort, having faced increased scrutiny of COVID-handling and associated economic impacts in an all-important US election year, whereas the ‘approved line’ suggest a simple continuation of ‘opening up’ to global markets.
Key outcomes from the recent SAFE directives seek to “To further improve the business environment and serve the high-quality growth of the real economy, the SAFE decides to optimize foreign exchange administration and improve foreign exchange services to enhance cross-border trade and investment facilitation.”
Critics point to much of the initiatives as window dressing, in an effort to counter increasing global hostility stemming from economic impacts claimed to have been exacerbated by the Central Government’s handling of COVID spread outside of China. Keen readers will find several intriguing elements which may suggest the signals being sent by the CCP to global markets are firmly welded to stated mercantalist objectives designed to enhance China’s economic power base throughout Asia and the wider non-Western markets. Some may work, and others……..Read more