China Outlook 2021
Resurgent China Sets Sights on Global Financial Markets Powerhouse Status post-Covid
China’s successful early handling of the coronavirus pandemic through strict lockdowns has meant it was the only major economy to grow and not shrink in 2020, expanding its share of the world economy at triple the rate of 2019. The resurgence in economic growth has emboldened the Chinese government to drive forward in throwing open its domestic financial sector to create an irresistible magnet for international investors and establish China as an investment destination to match its status as a world trade powerhouse, while posing a challenge to the U.S. dominance of global capital markets and a dilemma for Europe, speakers at a recent online media roundtable hosted in Amsterdam concluded.
“China-U.S. rivalry will come to dominate financial markets as it does now global trade and European governments and investors will be pushed to resist American efforts to decouple from China, because a strong global economic recovery from Covid-19 requires strong economic cooperation with the Chinese. European institutional investors realise that Chinese markets will continue to offer them very important and increasingly growing opportunities and this will place them between a rock and hard place of the geopolitics of American pressure and the economics of Chinese growth,” Ties Dams, research fellow at the Netherlands Institute of International Relations ‘Clingendael,’ told journalists.
Dams is the co-author of the Clingendael research report: Fire and Haze – Sino-U.S. rivalry, the Covid-19 crisis and financial markets. The Clingendael Institute is a co-founder, along with AXA Investment Managers, of The China Platform for European Institutional Investors, which facilitated the media roundtable and has a particular focus on geopolitics and the dynamic field of Chinese ‘green financing’ and its role in international efforts to address Global Climate Change.