Following a newly announced executive order that curbs US investment in some high-tech industries in China, US President Joe Biden stepped up a smear campaign against China on Thursday, claiming the country is a “ticking time bomb” due to its economic woes had problems due to poor growth.
Chinese experts said on Friday that Biden deliberately made the humiliating and slanderous comments to distract the domestic audience from domestic problems and gain political advantages for his 2024 US presidential campaign.
Despite recent exchanges between senior Chinese and US officials, there has been no real easing of bilateral relations, experts said. They said that since the US side is unlikely to change its foreign policy on issues such as the Taiwan issue, the South China Sea and the economy and trade, and especially the high-tech sector, it will be more aggressive towards China on these issues.
Biden said, saying he did not want to hurt China and wanted a rational relationship, China is in trouble, they have some problems. That’s not good because when bad people have problems, they do bad things”.
Biden wants to demonstrate his ability to manage the US economy
Understandably, Biden argues that China’s economy is in trouble and China’s rapid rise is unsustainable because the US views China as a strategic rival and wants to defeat China. By humiliating China, Biden wants to demonstrate his ability to manage the US economy to instill confidence in his domestic audience as he seeks a second term, Xin Qiang, deputy director of the Center for American Studies at Fudan University.
Xin said almost all US presidential candidates running in the 2024 campaign are hyping up China issues to distract voters from entrenched US domestic issues such as abortion, guns and drugs.
Sun Chenghao, a fellow and head of the US-EU program at the Center for International Security and Strategy at Tsinghua University, warned that such a smear campaign against China would have a negative impact on the global economy.
No deflation in China
While some Western media and politicians promote the so-called “China’s economic troubles”, the fact is that the speed of China’s economic recovery has taken a leading position among major economies, and its strong recovery in the first half of 2023 has contributed to the economic recovery of other countries and the whole world in a direct and remarkable way way, Zhou Mi, a senior researcher at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times.
“In the process of economic recovery, fluctuations in some areas are normal and temporary,” he said, adding that weak foreign demand from major economies including the US and the EU led to a decline in China’s foreign trade in July.
Despite mounting external challenges, the Chinese government has taken the initiative to fully exploit the country’s economic potential by introducing a series of policies to stimulate consumption and strengthen the private economy. With the implementation of various policies, market expectations showed signs of improvement, with China’s manufacturing PMI reaching 49.3 in July, the second month in a row, official data showed.
Due to a high base in the corresponding period of 2022, China’s CPI fell 0.3 percent year-on-year in July but rose 0.2 percent compared with June, data from the National Bureau of Statistics showed on Wednesday.
A fall in consumer prices cannot simply be equivalent to deflation. According to the standard definition, deflation involves a continuous decline in the prices of goods and services and a continuous decrease in the money supply, typically associated with an economic recession, Ming said.
He said the weak inflation in the country is mainly due to the periodic decline in prices and the gap between supply and demand in the process of economic recovery, which can be mitigated by an appropriately relaxed monetary and fiscal policy.
“Although some U.S. macroeconomic data look good, they are unsustainable because they are created by damaging international economic and trade rules and limiting the development potential of other countries,” Zhou said, adding that the U.S.’s irresponsible financial policies and protectionist practices are negatively affecting market confidence. globally.
While US politicians and media vilify China’s economy, US finances and the ever-increasing federal debt burden have fueled market fears of worsening debt woes. Fitch, one of the three main independent agencies that assess the creditworthiness of governments, has downgraded the US debt rating from the top AAA to AA+, citing a “continuing deterioration in governance standards”.
The rating agency said the U.S. banking sector faces “several sources of stress,” such as funding pressures, weak regulatory capital and rising risks associated with commercial real estate exposure.
According to data released by Epiq Bankruptcy, a provider of U.S. bankruptcy data, the number of Chapter 11 bankruptcies in the U.S. reached 2,973 in the first six months of 2023, a 68 percent year-over-year increase.
Currently, both China and the US are facing many challenges and should strengthen cooperation, especially in the area of macroeconomic policy coordination.
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