Vladimir Putin recently made comments on the seriousness of global conflicts that can lead to nuclear conflict. Patriots worldwide should pay close attention as the globalists build their dangerous nuclear arsenal.
In stark contrast to attempts in numerous western countries to stifle free speech online, Russian President Vladimir Putin defended Internet freedom during a conference...
A prominent Swedish lawmaker asserts that Hungarian billionaire George Soros's influence on European politics and policies make him "one of the most dangerous men,"
Having tumbled yesterday on the first set of headlines reporting on the Trump administration's plans to seek 'COVID reparations' amid accusations of Chinese 'meddling' in the US election (obviously not in
favor of Trump), the Chinese yuan legged dramatically lower in this
evening's illiquid session which sees most of Asia closed for May Day,
after Bloomberg reports that Trump is exploring blocking a
government retirement fund from investing in Chinese equities considered
a national security risk.
Trump made his initial threats from the Rose Garden at the White
House Monday after he was pressed by a reporter over a German newspaper
report suggesting that China should be issued a $160 billion invoice for
the impact on Europe's economy.
"We have ways of doing things a lot easier than that," Trump told the coronavirus press briefing. "Germany’s
looking at things, and we’re looking at things, and we’re talking about
a lot more money than Germany’s talking about."
"We haven’t determined the final amount yet. It’s very substantial," Trump added, suggesting it would be significantly more than the $160 billion floated in German media.
Asked whether he was considering the use of tariffs or even a debt
write-offs for China (something which Larry Kudlow vehemently rejected
earlier on Thursday), Trump would not offer specifics.
“There are many things I can do,” he said. “We’re looking for what happened.”
Since then various plans have been proposed, but Trump escalated the war of words further, during an Oval Office interview with Reuters published Wednesday night, saying that he thinks that China is determined to see him lose the November election
based on Beijing’s response to the coronavirus, and that he is
considering various ways to punish the Chinese government which he he
again blamed for allowing the virus to spread across the world.
"China will do anything they can to have me lose this race," Trump
said in the interview and said he was looking at different options in
terms of consequences for Beijing over the virus. “I can do a lot,” he
said.
Which was quickly followed by denials from Chinese Foreign Ministry spokesman Geng Shuang, saying that China has no interest in interfering in internal U.S. affairs
(unless of course that 'affair' involves investigating the origin of
COVID-19). China hopes some people in U.S. won’t drag country into its
internal processes, Geng said.
And tonight, Bloomberg reports that, after months of pressure from
concerned lawmakers, according to a person familiar with the internal
deliberations, the Trump admin is planning an executive order to
block a 2017 decision that The Thrift Savings Plan, the federal
government’s retirement savings fund, would transfer a massive $50
billion to an international fund which would mirror the MSCI All-Country
World Index.
The issue being China's addition to the index, and thus the fund
being forced to allocate significant capital to the Chinese stock
markets, at a time when the gloves between the two nations are clearly
off.
Needless to say, the optics of the US halting capital from entering
China would be staggering and could result in a reversion of China-bound
capital flows across all Western countries until the current war of
words between Trump and Xi rages. The only problem is that, as we noted
yesterday, this particular war of words could last a long time, since
there is no longer any impetus to kiss and make up, and if anything,
Trump will only escalate the anti-China sentiment into the election (and
after), to keep pounding that the collapse resulting from the
coronavirus pandemic is not his fault, but rather's Beijing, even as
China pursues a mirror image approach, blaming the US for launching the
pandemic.
The most obvious market reaction for now is in Offshore Yuan which
has collapsed in the last two days, extending losses tonight...
Source: Bloomberg
Bloomberg reports that Senator Marco Rubio, a Florida Republican, applauded reports of the move in a statement Thursday.
“It’s outrageous that five unelected bureaucrats appointed by the
previous administration have ignored bipartisan calls from Congress to
reverse this short-sighted decision, and I applaud President Trump for
directing his administration to take swift action preventing this from
going forward,” he said.
We would expect China to be furious at this discussion and wonder
what they will do to stall this move - one suggestion, given the
weakness in US equity futures overnight, is to push volatility back into
US markets - to shake the faith in the dramatic market rebound (that
The Fed enabled).
Amidst global economic slowdown, Russia’s industrial production shows
stellar growth. After sanctions and rejection of Western imports,
Russia’s domestic import substitution program is showing impressive
results. Industrial production up 2.6% year-on-year for the first half
year. And accelerating, up 3.3% in June from last year. In the same
period, the subsector manufacturing (factory production) surged by a
staggering 3.4%, which really shows Russia is going full steam ahead.
Meanwhile, no growth in the US over the year, with two last quarters negative.
Russian President Vladimir Putin slammed appeals to abandon technological progress for the sake of prioritizing green politics.
"A profound and meaningful discussion" is needed to hash over the
problems of combining long-term development and environmental welfare,
and a high standard of living, the president told the Global
Manufacturing and Industrialization Summit (GMIS) on Tuesday.
"However, instead of a substantive discussion regarding the global,
climatic and environmental agenda, we often see, unfortunately,
downright populism, speculation, and sometimes, I am not afraid to say
this - simply narrow-mindedness," Putin stressed.
"It comes to the point when the world is urged to ditch progress,
which will make it possible to freeze the situation at the best, and
create prosperity for the select few. In contrast, hundreds of millions
of people throughout the globe will have to accept that at the moment
they have, or it would be more honest to say, don’t have access to clean
water, food, education and other benefits of civilization," he said.
"This
archaism is a blind alley, it is a road to new conflicts," the Russian
leader pointed out. According to him, "the migration crisis in Europe
and in the US stems from this". A blind faith in simple, impressive but
inefficient solutions leads to problems," Putin cautioned, mentioning
appeals to abandon nuclear and hydrocarbon energy, while betting on
current alternative sources of energy.
"Will people feel comfortable living on the planet dotted with
wind-driven generators and covered with layers of solar batteries?" he
asked, then noting that as the saying goes "instead of tidying up the
house we’ll just sweep the garbage under the rug". He also mentioned
problems with wind-powered generators that lead to the deaths of birds,
and other side effects that this source creates.
"Of course, we can't stop those who want to wear animal skins or move
into caves, but it is impossible and absolutely absurd to stop human
progress," the Russian president stressed.
The "worst case" trade war scenario was avoided in Osaka on Saturday when Trump agreed to restart trade talks with Xi, holding off new tariffs on Chinese exports, and signaling a pause in the trade hostilities between the world’s two largest economies; Trump added that while existing tariffs would remain in place the
US president eased restrictions on Huawei as part of what is now the
second ceasefire between the two superpowers in two months, removing an
immediate threat looming over the global economy even as a lasting peace
remains elusive.
"We had a very good meeting with President Xi of China, excellent, I
would say excellent, as good as it was going to be," he said. "We
discussed a lot of things and we're right back on track and we'll see
what happens", Trump told reporters after an 80-minute meeting with
Chinese President Xi Jinping on the sidelines of a summit of leaders of
the G-20 major economies in Osaka, western Japan.
“We’re holding back on tariffs and they’re going to buy farm products,” he said vaguely at a news conference, without giving any details of China’s future agricultural product purchases. “If
we make a deal, it will be a very historic event.” He gave no timeline
for what he called a complex deal but said he was not in a rush. “I want
to get it right.”
Whereas Trump and top admin officials alleged that Beijing had
reneged on provisions of a tentative trade deal, it was not immediately
clear if Xi agreed to return to previous agreements as part of the new
truce.
Trump, however, did relent on one of the major sticking points, saying U.S. firms would be allowed to sell components to Huawei, the
world’s biggest telecom network gear maker, where there was no national
security problem. The president said the U.S. commerce department would
meet in the next few days on whether to take it off a list of firms
banned from buying components and technology from U.S. companies without
government approval.
"I like our companies selling things to other people, so I allowed
that to happen," Trump said. “We’re talking about equipment where
there’s no great national security problem with it.” In recent months,
the Trump administration has been lobbying allies around the world not
to buy Huawei equipment, which the U.S. says could be used for Chinese
espionage.
Huawei was delighted by the news on its verified Twitter account:
“U-turn? Donald Trump suggests he would allow #Huawei to once again
purchase U.S. technology!”
Predictably, China also welcomed the step. “If the U.S. does what it
says, then of course, we welcome it,” said Wang Xiaolong, the Chinese
foreign ministry’s envoy for G20 affairs.
Trump said he had not yet decided how to allow U.S. companies to
continue selling to Huawei or whether to remove the tech giant from the
Commerce Department’s entity list. He said he would meet with advisors
next week to determine how to proceed.
U.S. microchip makers also applauded the move. “We are encouraged the
talks are restarting and additional tariffs are on hold and we look
forward to getting more detail on the president’s remarks on Huawei,”
John Neuffer, president of the U.S. Semiconductor Association, said in a
statement. Recently, Broadcom warned of a broad slowdown in demand as a
result of Huawei sanctions and slashed its revenue forecast.
And yet, it was not clear how long the exemption would last. Trump
said he had agreed with Xi to wait until the very end of trade talks to
resolve broader issues around Huawei, including Washington’s lobbying
campaign against allies buying its 5G equipment.
“Huawei is a complicated situation,” Trump said. “We’re leaving Huawei toward the end. We’ll see where we go with a trade agreement.”
The concession will likely draw criticism in Washington where
national security hawks have urged Trump not to ease any pressure
against Huawei. The company has long been the target of concern at the
Pentagon and intelligence agencies in part over what the U.S. claims are
its close ties to the Chinese military.
Huawei is one of few potent levers we have to make China play fair on trade.
If President @realDonaldTrump backs off, as it appears he is doing, it will dramatically undercut our ability to change China’s unfair trades practices.https://t.co/rja8CDs2T4
By agreeing to weaken restrictions on #Huawei, Trump not only undermined his own government, he undermined the entire argument #Huawei is a real national security threat. #facepalmhttps://t.co/BzuM8QA0Na
In exchange for his Huawei concession, Trump said Xi Jinping had promised to buy “tremendous” amounts of U.S. agricultural products. “We’re
going to give them a list of things we’d like them to buy,” Trump said
at a news conference following the Group of 20 summit in Osaka, Japan.
However, as Bloomberg notes, the first indications the second fragile
truce will collapse soon is that the Chinese official media reports said
only that the U.S. president hopes China will import more American goods as part of the truce, without an actual confirmation it will do so.
For now, however, the second truce, after a similar ceasefire was
announced on December 1 at the Buenos Aires G-20 summit, has been
achieved, offering relief from a nearly year-long trade standoff in
which the countries have slapped tariffs on billions of dollars of each
other’s imports, disrupting global supply lines, roiling markets and
dragging on global economic growth.
In a lengthy statement on the two-way talks, China’s foreign ministry
quoted Xi as telling Trump he hoped the United States could treat
Chinese companies fairly. On the issues of sovereignty and respect, Xi
said that "China must safeguard its core interests."
“China is sincere about continuing negotiations with the
United States ... but negotiations should be equal and show mutual
respect,” the foreign ministry quoted Xi as saying.
Trump had threatened to extend existing tariffs to almost all Chinese
imports into the United States if the meeting brought no progress on
wide-ranging U.S. demands for reforms.
The return to the negotiating table ends a six-week stalemate that has unnerved companies and investors, and
at least temporarily reduces fears that the world’s two largest
economies are headed into a new cold war, which they still are but only
after the current stalemate ends allowing the S&P to rise above
3,000 in the the meantime. Because, as Bloomberg notes, it’s
unclear how they can overcome differences that led to the collapse of a
previous truce reached at the G-20 in November.
* * *
While Trump and Xi were all smiles at their press briefing, the bad
blood between the two leaders behind the scenes is clearly still there.
Xi spent much of the summit’s first day Friday promising to open up the
Chinese economy, and attacking the U.S. (without naming it) for its
attack on the global trading system. As Bloomberg reported, Xi took a
"not-so-subtle swipe" at Trump’s “America first” trade policy in remarks
to African leaders on Friday, warning against “bullying practices” and
adding that “any attempt to put one’s own interests first and undermine
others’ will not win any popularity.” Xi also called out the U.S. over
Huawei and said the G-20 should uphold the “completeness and vitality of
global supply chains.”
For now, however, there is optimism.
“Returning to negotiations is good news for the business community
and breathes some much needed certainty into a slowly deteriorating
relationship,” said Jacob Parker, a vice-president of China operations
at the U.S.-China Business Council. But "now comes the hard work
of finding consensus on the most difficult issues in the relationship,
but with a commitment from the top we’re hopeful this will put the two
sides on a sustained path to resolution,” he said.
Others were more skeptical, and warned the pause - just like the first ceasefire - will not last.
“Even if a truce happens this weekend, a subsequent breakdown of
talks followed by further escalation still seems likely,” Capital
Economics said in a commentary on Friday, quoted by Reuters.
The United States says China has been stealing American intellectual
property for years, forces U.S. firms to share trade secrets as a
condition for doing business in China, and subsidizes state-owned firms
to dominate industries. Meanwhile, China has said the United States is
making unreasonable demands and must also make concessions.
The talks collapsed in May after Washington accused Beijing of
reneging on reform pledges. Trump raised tariffs to 25% from 10% on $200
billion of Chinese goods, and China retaliated with levies on U.S.
imports.
The U.S.-China feud had cast a pall over the two-day G20 gathering,
with leaders pointing to the threat to global growth. In their
communique, the leaders warned of growing risks to the world economy but
stopped short of denouncing protectionism, calling instead for a free,
fair trade environment after talks some members described as difficult.
* * *
Finally, global markets will breathe a sigh of relief on news of the
resumption in U.S.-China trade talks, even as an official deal remains
elusive, and there is no indication of how the two countries will bridge
the most difficult aspect of a feud that has emerged beyond simple
trade and now affects most aspects of US and Chinese life.
The flip-side is that with trade talks back on, the Fed will feel far
less pressure to ease in July, and since in June stocks exploded higher
on hopes that the Fed will cut rates as much as 50bps next month, such a
reversal in US-China relations could potentially prevent Powell from
capitulating, and leave the Fed on hold, an outcome which would lead to a
sharp drop in US capital markets. Indeed, in recent weeks, the S&P
has returned to record highs, treasury yields have tumbled to their
lowest level in years. The Japanese yen, a traditional beneficiary of
flight to quality, has gained, while the U.S. dollar has slipped across
the board, including against China’s yuan.
In an interview with the Financial Times, Putin told that “the liberal
idea” had “outlived its purpose” and said that nationalism is growing
instead as the public has turned against immigration, open borders and
multiculturalism.
“This liberal idea presupposes that nothing
needs to be done. That migrants can kill, plunder and rape with impunity
because their rights as migrants have to be protected,” the president succinctly put it.
Putin chastised the European liberal governments for not having acted
to reassure the citizens. Instead those governments had pursued a
mindless multiculturalism embracing, among other things, [false] sexual
diversity.
On a positive note the president told that the
liberals cannot anymore “simply dictate anything to anyone just like
they have been attempting to do over the recent decades.”
Jon Hellevig: "Instead of bailing out banks and oligarchs, Kazakhstan will write off
loans of the poor. This has been announced by new Kazakh president
Kassym-Jomart Tokayev. There’s an unexpected corner of the world from
where sound and fair financial policies emanate!
Doing this
President Tokayev is actually reviving an ancient traditions of
cancelling debts when a new ruler took over going back to Hammurabi, the
Sumerians and other Near Eastern rulers. Michael Hudson has written a
book called “And Forgive their Debts” depicting this story from Babylonia and to other Bronze Age Near Eastern realms.
Hudson tells that this concept of starting from a clean slate was also
at the center of the Old and New Testaments, in the form of the Jubilee
Year. Jesus actually said: “Forgive them their debts,” but it was
converted by the Church to mean something vague in the form of: “Forgive
them their sins.” Actually meaning, just pay up, and we’ll deal with
the debts at the final judgement once you kick the bucket.
Forgiving of debts was also in ancient Greece and Rome an important
policy goal in the fight against the oligarchs. Should become again."
Nariman Gizitdinov and Tony Halpin • Bloomberg
Kazakhstan President Kassym-Jomart Tokayev said the debt relief would cost less than $1bn [Pavel Golovkin/Pool/Reuters]
Kazakh
President Kassym-Jomart Tokayev said he'll write off bad loans held by a
sixth of the central Asian country's population, while signaling a
sharp change in policy to end costly state bailouts of private banks.
The loan-forgiveness program is Tokayev's first major policy
announcement since he was elected president on June 9 in a choreographed
transfer of power that began when longtime leader Nursultan Nazarbayev
stepped down as head of state in March. His victory was met with rare
and widespread protests.
Bank bailouts are also a sensitive issue in Kazakhstan, which has
been mired in a decade-long crisis in which the government has pumped at
least $18 billion into lenders to keep the sector from collapsing under
the weight of bad debts. The central bank is conducting a review of
asset quality, prompting speculation that a new round of bailouts may be
in the works.
"My attitude is that there should be no governmental bailouts" for
lenders, Tokayev, 66, said in an interview Tuesday in the capital,
Nur-Sultan. "My assessment of this issue as a president is that the
government should not get involved any more, any longer, with its loans
as far as private banks are concerned."
Debt relief
While the debt-relief initiative may help lenders, the total
cost is likely to come in at "a bit less than $1 billion," according to
Tokayev. More than 3 million Kazakhs in the energy-rich country of 18
million will get help to escape debts averaging 300,000 tenge ($790), he
said. It is aimed at "people who find themselves in very difficult
living circumstances," he said.
About 4,000 people were detained by police during a rare outburst of
protests against what activists said was a lack of real choice in the
recent vote, which Tokayev won easily with 71% support. Leader-for-life
Nazarbayev, 78, handed the presidency to Tokayev in March, who called
the early election "to remove any uncertainty." International
observers criticized the conduct of the vote.
The new president's debt forgiveness program is similar to a
controversial policy unveiled by Georgia's ruling party,
which announced the write-off of loans for 600,000 people days before a
hotly-contested presidential election won by its candidate in November.
"We are not following the example of Georgia, this is a different case"
focused on the poorest citizens, Tokayev said.
Nazarbayev berated ministers as "cowards" in January for failing to
clean up the banking system, shortly before he dismissed the government
and replaced the central bank governor. Yet the biggest bank rescues
have involved people close to the former president's inner circle.
While Tokayev denied that political connections played a role in past
bailouts, "the lesson has been accepted by us," he said. "We will take
lessons from the past, from what has happened in the banking system, and
I think that in a couple of years you'll have absolutely new
questions."
The CIA has called on its puppet regime in Georgia to make a serious
provocation against Russia, with staged demonstrations and threats
against Russians. An American woman who serves as the US puppet
president of that country declared that "Russians are our enemies and
occupiers." Protesters held up signs telling Russians to **ck off.
Then Putin told Russians would do just that, **ck off. There came a
Russian law, that no flights between Russia and Georgia are allowed,
meaning no tourists will travel.
The rub here is that Russians are by far the biggest paying tourist
group. They are the biggest group, but also the most affluent group.
Armenians and Azeris from neighboring countries also cross the borders,
but they hardly keep the economy going.
But the Russians do. 30%
of the Georgian economy comes from tourism. And about at least one-fifth
or some 6-7 percentage points of that stems from the aggressors
(Russians). Russia is also the only country that buys their wine and
mineral water. That could be another 2-3%. So, this CIA inspired
provocation will cost about 10% of the already miniscule GDP of that
country.
Georgia's GDP is about 16 billion USD nominally, and 40
billion on PPP. Tourism is 3 billion out of that (9 billion on PPP).
So, quite a costly provocation. Good luck with that.
Georgia has been hostile to Russia aleady for 10 years. Now with the
spark of this new round of hostility they say that they will get
tourists from other countries if Russians won't come. But then why did
they don't get any other tourists during the last 10 years of
hostilities?
Jon Hellevig writes: I don't know why Russia does this. They reported Q1 GDP growth of
0.5%. But they said the GDP deflator was 8.5%. GDP deflator is the
factor by which you diminish the nominal GDP growth. The idea is that it
would show the "real growth" of output instead of price inflation. In
this methodological theory you would only show as output increase
quantitative and qualitative growth but not price growth. But the
inflation in the same period was only 5%. So, Russia decreases the GDP growth
by much more than the inflation. At the same time, the price of oil and
gas has not increased from last year, and not that of other commodities
either.
So, where from do they find this 3.5% decrease above inflation? I would not
exclude that there is a Serdyukov ploy playing out here. Referring to
the time he was Minister of Defense and grabbing the headlines because
of corruption, while at the same time under his term Russia made an
incredible modernization of the army. The one that took over Crimea in a
night, and Syria in two years. There's a theory that Russia wanted they
Yanks to think that the Russian army is a quagmire and will stay so
until the time is right.
So, perhaps I am giving the game away, and the Russian economy is actually growing much more than they want us to know.
At the same time, the real-real GDP, the one measured in PPP grows
exactly by the nominal minus inflation plus the "nominal real growth"
plus/minus difference in currency exchange to the USD. That is 9 - 5.5 +
0.5 + 0=4%
I just finished reading a book called Putinomics by Chris Miller. He
had earlier written a book on Gorbachev's failed perestroika, except he
did not call it failed, rather it was an apology of that failure.
Nevertheless there was a lot of interesting facts (which facts the
author tried to tweak to fit his agenda). All in all, I was satisfied
with the reading, it gave me just what I was looking for, cause I am
very apt at separating facts from the narrative.
His second book "Putinomics"
is just what the heading promised. "Putinomics" - what a nonsensical
concept that has been clearly chosen to appease the author's publisher.
He discusses Putin's economic policies throughout his rule. In the text
itself Miller provides no information that could in anyway justify the
comical title, as if Putin was engaged in some hullabaloo excentric
policies. Instead he gives a fairly reasonable account of how Putin has
driven the economy. However, the big picture is lacking, and at the end
of the reading one is in no way the wiser from having read Western MSM
propaganda on the topic for 10 years. What surprises is that the book is
so badly structured and does not in anyway dig into the most important
topics, like modernization, corruption etc. Miller tells there is a lot
of corruption, but he does not provide any evidence, not even discussion
on that, and worst of all there is no comparative analysis, which would
show Russia is far behind his own United States what comes to graft.
The one good thing is the author's surprisingly candid account on the
criminal machinations that led to Khodorkovsky's downfall and the happy
jailing of him, which marked the end of oligarch rule of Russia.
On the other hand the book is replete with all the classic Russophobe
tropes - no doubt the grants would not have been flowing in otherwise
and the book would not have been published. In addition to all the trite
Western repetitions of "corruption," an "ineffective state sector",
"Putin's pals" etc, we also read that Sechin (CEO of Rosneft) an
employed director for a state owned corporation is repeatedly referred
to as an oligarch.
Vladimir Putin was first elected as Russian President in 2000.
Here’s how the Russian economy has transformed in the intervening years
by numbers.
Quality of life
Before
Putin’s election, Russia had a $9,889 GDP per capita by Purchasing
Power Parity (PPP). The figure had almost tripled by 2017, and has now
reached $27,900. Russia has the highest GDP per capita among its fellow
BRICS countries, with the next-highest, China, having just $16,624. The
PPP takes into account the relative cost of living and the inflation
rates of countries in order to compare living standards in different
nations.
The average nominal monthly wage has grown almost 11-fold
from $61 to $652. Unemployment has contracted from 13 percent to 5.2
percent. Pensions have grown over 1,000 percent in the same period from
$20 to $221.
The Yuan Brings About Pakistan’s Second Declaration of Independence
By Adam Garrie
With Pakistan refusing to bend or break under US pressure, even as Washington is set to cut hundreds of millions in “aid” to Pakistan, many Pakistanis are asking themselves, “why didn’t we do this sooner”?
The answer is—in a word: CHINA.
When the US took the abrasive move to formally censure Pakistan under the guise that it harbours and abets terrorism and cut hundreds of millions in what the US calls “aid” but what in reality is US military investment, Pakistan said, “so be it” and said so boldly.
After losing over 100,000 Pakistanis in America’s ill-advised regional military operation in Afghanistan, a conflict which the US intentionally allowed to spill over Pakistan’s border, Pakistani elites and ordinary people have collectively had enough. Many have had enough for decades, not least PTI leader Imran Khan whose anti-American positions have been largely vindicated by recent events.
But while the uneven “alliance” between Washington and Islamabad has alienated Pakistanis for decades, even prior to the US invasion of Afghanistan, what has changed is that there is a new superpower with a colossal presence in the region--one that is willing to forge a thorough partnership with Pakistan and in doing so, rendering any perceived advantages incurred from a US “alliance” more or less dispensable.
For years, China’s investment in Pakistan along the China-Pakistan Economic Corridor has breathed new life into Pakistan’s economy. From the mountainous border in the north to the Panamax Gwadar Port on the Indian Ocean, China’s positive influence can be felt throughout Pakistan’s vast terrain.
The influx of Chinese experts, workers and high level diplomats in the country has proved that a revitalised Cold War era friendship is by the standards of 2017, one based on pragmatism, mutual respect and a win-win mentality that contrasts sharply with a US attitude of disdain towards Pakistan. This attitude is magnified even more deeply by Pakistan’s Saudi “ally” that has used and abused Pakistan for decades, in a cold exploitation of the country’s financial needs.
Pakistan’s refusal to follow Saudi and the UAE into Yemen and likewise, Pakistan’s refusal to take Saudi Arabia’s side in the ongoing dispute with Qatar, is as much a reflection of the confidence and renewed independence that a Chinese partnership has given Pakistan as it is a reflection of the increased professionalization of Pakistan’s “deep state” which is largely immune to the fluxuations of Parliamentary politics, while wise enough not to inhibit the peaceful exercise of Pakistan’s multi-party democracy.
Pakistan’s refusing to blindly follow Washington’s increasingly anti-Pakistan Afghan policies is a further result of the geo-political armour that China has allowed Pakistan to wear with pride, as it is symptomatic of a Pakistani “deep state” that is far more pragmatic and intelligent than it was 20 years ago.
But the most important development thus far, in Pakistan’s 21st century partnership with China is the agreement to conduct bilateral trade in the Yuan rather than the Dollar. This agreement was inevitable, but the fact that it was agreed just after Donald Trump’s insulting statements about Pakistan followed by the withdrawal of “aid”, sends both a pragmatic and symbolic message to the world. Pakistan is not for sale and nor will Pakistan refrain from taking action to build new partnerships out of fear that the US will be permanently lost as an “ally”. Just as the US closed one door, Pakistan and China quietly and rapidly opened another much larger door.
The treat of US financial blackmail becomes limited in its scope when one realises that Pakistan’s most important long-term trading partner is a country that is not only powerful enough to resist the Dollar’s fading hegemonic grip on global trade, but that moreover, it is a country that owns the lion’s share of US debt. This country is of course, China.
The Dollar might still control much of the world, but with China controlling the Dollar, all the while readying the Yuan for its inevitable transition to a floating currency, it is China that now has the last word when it comes to the effectiveness of US financial blackmail as well as US sanctions.
In this sense, Pakistan’s agreement to trade with China exclusively in Yuan is like a second declaration of independence for Pakistan. Furthermore, the move will certainly inspire other nations to rethink their dependence on Dollar based institutions.
With the US also cutting Pakistan out of security/intelligence sharing agreements, it is high time for Pakistani leaders to admit a long standing reality. The US has never been Pakistan’s ally, it has merely been a two-faced benefactor whose investments in the country were never designed to increase Pakistan’s sovereignty, prestige or safety. In reality, they were designed to bring about the opposite.
By contrast, the Chinese model does not make demands on one’s foreign policy, security policy, wider partnerships or style of government. China demands only honesty and respect and rewards this with the same.
When promoting One Belt—One Road throughout the world, President Xi Jinping is always eager to point out that China’s global trading network is all about enhancing mutual strengths while supplementing areas of economic or production relation weakness. There are no strings attached in One Belt—One Road—the obvious implication being that in the US model of global trading mechanisms there are many strings attached.
Philippines President Rodrigo Duterte stated that one of the reasons he prefers modernising the armed forces of Philippines using Russia and Chinese weapons, is because Russia and China do not make such sales conditional upon political demands. The same is true with wider trading partnerships with the great superpowers of the global “east”.
The US will surely amplify its anti-Pakistan rhetoric in the coming months and one shouldn’t be surprised if ultimately this leads to sanctions against a former “ally”.
But China has made Pakistan largely immune to Washington’s bullying techniques and thus serves as a model for the world that if one wants to make one’s own country “great again”—one must ditch the US as an indelible partner and embrace sovereignty with Chinese trading characteristics.
![Kazakhstan President Kassym-Jomart Tokayev said the debt relief would cost less than $1bn [Pavel Golovkin/Pool/Reuters]](https://www.aljazeera.com/mritems/imagecache/mbdxxlarge/mritems/Images/2019/6/26/b0d6e4b223b74241bd14d599a84cf662_18.jpg "Kazakhstan ends bank bailouts, writes off people's debts instead")
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