The currency’s correlation with an MSCI Inc index of its developing-nation peers rose to record in September on a weekly basis before edging back slightly amid the Omicron outbreak, Bloomberg data show.
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BEIJING: The Chinese yuan is having a greater impact on its emerging-market counterparts than ever before and may play a crucial role in determining their performance in the coming year.
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The currency’s correlation with an MSCI Inc index of its developing-nation peers rose to record in September on a weekly basis before edging back slightly amid the Omicron outbreak, Bloomberg data show.
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While the close relationship is partly a result of China’s large weighting, it’s also been driven by the yuan’s links to the Brazilian real reaching the strongest since at least 2008, and that with India’s rupee touching a three-year high.The yuan’s rising global influence is yet another sign of China’s deepening connections across the world economy.
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Investors are increasingly being drawn to its bonds as an alternative to United States Treasuries, while some banks are calling for the yuan to join the dollar, euro and yen as a global reserve currency.
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Yet with China’s potential being offset by murky policy making and regulatory crackdowns, being tied too closely to the yuan may also backfire.
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“China is going to be a very important element of emerging-market stability and the growth picture,” said Magdalena Polan, principal economist at PGIM Ltd in London.
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“The willingness for Chinese policy makers to stabilise growth will be very important to the outlook for Latam and Asia and South Africa, as countries there still rely quite a lot on exports from China.”
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While correlations can be measured in many ways, China’s increasing presence in global trade has progressively boosted the yuan’s links with those of its emerging-market peers.
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In 2000, the average developing nation sent only 2.2% of its exports to China, while that proportion has now grown to 11.3%, according to data from Societe Generale SA.
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The investment bank says the yuan’s relative stability has traditionally made it most closely correlated with those of its emerging-market peers with strong and credible policy makers such as Mexico, Chile and South Korea.
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Since the US-China trade war in 2018, however, the yuan’s links with emerging markets as a whole have grown stronger, with the average correlation rising to 83% that year, according to SocGen data.
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There’s a risk of course that those very connections may also weigh on emerging-market currencies if the yuan begins to weaken. The major risk of that happening looks to be due to potential policy divergence, with the People’s Bank of China expected to ease monetary policy in 2022, just as central banks from the US, UK and Australia start to tighten.
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The yuan will face a particular challenge as the Federal Reserve beings to raise borrowing costs, a move that is anticipated to lead to a stronger dollar and outflows from emergin
`g markets. Still, China’s currency has so far shown itself to be relatively resilient to monetary policy at home and abroad.
China’s economy has become an increasingly important influence on global growth over the past decade, and a vital one for emerging markets, according to JP Morgan Private Bank.
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“Since the financial crisis, we’ve had mini cycles in global emerging markets, largely coincident in China’s property and credit cycle and since the crisis that has been the key driver of the outlook in emerging markets for the most part,” said Alexander Wolf, head of investment strategy, Asia, at JP Morgan Private Bank in Hong Kong.
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The yuan’s relative resilience this year has also played a role in limiting fluctuations across emerging markets, in what has otherwise been a very tumultuous 12 months.
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“The fact that the yuan’s not doing too much I categorise it as a volatility suppressant,” said Paul Mackel, head of global foreign-exchange research at HSBC Holdings Plc in Hong Kong. “We believe that stability can last for longer.” — Bloomberg
Martin Jacques, former senior fellow at the Department of Politics and International Studies at Cambridge University, said on Thursday at A Dialogue on Democracy in Beijing that there are two problems in the Western concept of democracy. "The first is the lack of any serious historical context, and the second is the failure to understand and respect cultural difference," he said.
Dr. Rasul Baksh Rais, a political science professor from Pakistan, to discuss what democracy means to him and how he views the democratic system of China. Dr. Rais said that democracy does not have a single form and that "it is not important to measure democracy by Western standards."
Fragmented regions under US-instigated color revolutions -Funding opposition leaders, training protesters, pressuring through diplomacy, feeding biased media reports... #ColorRevolutions instigated by the US in the name of democracy have caused social conflicts around the world. #WeaponizedDemocracy
Democracy summit will dodge questions on governance gap between China and US:
There is something more than a little ironic about President Biden's Summit for Democracy this week. The intention is blindingly obvious: to rally the troops in favour of Western-style democracy and draw a line in the sand between "democracy" (ie, the West) and "autocracy" (ie, China and Russia). In this Biden faces two huge problems, which will get little or no airing at the Summit. First, the Western democracies are in serious difficulties. And second, that China, in terms of governance, has been seriously out-performing the West.
The US talks about democracy in the manner of a slick TV advert. It is all good and no bad. It is timeless. It has long reigned and will reign forever. It cannot be improved upon. This, of course, is nonsense. No form of governance has, or will, last indefinitely. There are multiple signs that Western democracy is losing its popularity. Numerous Western polls have indicated growing disillusionment in their political systems.
Ultimately, any form of governance depends upon its ability to deliver. Whatever the fancy words, this is the bottom line. If it fails to deliver, then people will look for alternative forms of governance. Western governance was at its most successful during the long boom between 1945 and the mid-1970s. It delivered rapid economic growth, full employment, generous welfare reforms and prosperity. In the 1959 general election, the British Conservative Prime Minister ran on the slogan "You've never had it so good." He was right. And the Conservatives won big time. Even during the following rather less successful period between 1980 and 2007, Western governance still worked after a fashion. The turning-point was the Western financial crisis in 2008, the worst since 1931.
Ever since then, living standards in the West have struggled to return to even where they were in 2007. All the Western economies have remained on life-support, with zero or near zero interest rates, following the financial crisis. Their economic woes had political consequences, with growing disillusionment in the mainstream political parties and their leaders and, more seriously, in societal elites and governing institutions. The most dramatic case was the United States, the citadel of Western democracy. The reasons for the disaffection go back long before 2008: nearly half of all Americans have experienced static or falling living standards since 1980. Trump gave voice to the anti-establishment anger. His attitude towards democracy is, to put it mildly, unclear, as his covert support for the Insurrection at Capitol Hill last January well illustrates. Biden won the 2020 presidential election, but what will happen in 2024 is anyone's guess. The country is deeply divided and polarised to the point where there are almost two Americas. For the first time since the Civil War, there are serious doubts among Americans as to whether their democracy can survive.
Democracy works in good times but not so well in bad times. Between 1918 and 1939, a large majority of European states lived under various forms of dictatorship for part of, or most of, that period. Democracies were, for the most part, few and far between. The overriding reason was the Great Depression, with falling living standards, huge unemployment, impoverishment, racism, nationalism, and acute political polarisation.
Even if Western-style democracy survives, and it likely will in most Western countries, such are its deep roots, it will enjoy nothing of the elan and prestige it possessed during its heyday in the long boom, or even between 1980 and 2007. The reason is simple. Between 1945 and 2000, the West dominated the world. In 1970 it accounted for two-thirds of global GDP. The United States was by far the dominant country. Now the West accounts for rather less than half of global GDP while China, in terms of size, is on a par with America. We are in the process of transitioning to a post-Western world. Domestically and internationally, Western leaders enjoy much less prestige and authority than they did during the second half of the 20th century. Compare the regard in which Roosevelt, Eisenhower and Kennedy were held with that for George W Bush, Trump and Biden. And the same can be said of the declining respect for the US political system. The allure of democracy has greatly diminished.
The rise of China since 1978 has become a new measure of the performance of the United States and the West. Over this period China has out-performed the West in terms of delivery: the supercharged growth rate, the transformation in living standards, the huge reduction in poverty, the increase in life expectation, the long run social stability and the very high approval ratings. The way in which China has handled the pandemic, with just 4,636 deaths compared with 787,695 deaths in the US, is a powerful endorsement of Chinese governance and a shameful exposure of that in the US. Western democracy is under huge pressure both internally and externally. And the gulf between the relative performance between the US and China is set to grow ever wider.
These are the questions that should be discussed at the Summit for Democracy. But they won't be.
Martin Jacques was until recently a Senior Fellow at the Department of Politics and International Studies at Cambridge University. He is a Visiting Professor at the Institute of Modern International Relations at Tsinghua University and a Senior Fellow at the China Institute, Fudan University. He is the author of When China Rules the World.
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the core message of the UN Inter-governmental Panel on Climate Change
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Moral vacuum at the heart of modernity, now embodied in US laws!
` In short, historically it was the Church that gave the moral blessing for colonisation, slavery and genocide during the Age of Globalisation. The tragedy is that the Doctrine of Discovery is now embodied in US laws.
MAN and nature are running out of time. That’s the core message of the UN Inter-governmental Panel on Climate Change (IPCC) report released this week.
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UN secretary-general António Guterres called the report a “code red for humanity”. “The evidence is irrefutable: greenhouse gas emissions from fossil fuel burning and deforestation are choking our planet and putting billions of people at immediate risk.”
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What can we, individually and collectively, do about it?
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Many animals and human beings cannot survive at high temperatures. Seattle, a temperate climate city, hit 104 degrees Fahrenheit in June, only four degrees below the maximum 108 degrees where humans can’t survive.
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Like the pandemic, the twin effects of climate warming and biodiversity loss are hurting the bottom half of society who are most vulnerable to natural and/or man-made disasters.
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Indeed, indigenous and native people who live closest to nature, comprising 5%-6% of world population scattered in remote areas, are likely to face loss of culture, lives and habitat because all their water, food and livelihoods will be devastated by climate change.
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In essence, we are in an existential situation whereby nature is being destroyed by human excess consumption, which creates pollution and carbon emission, but all this is made possible by monetary creation by bankers and businesses who seem to care more about their profits than the human condition.
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Thus, decisions over climate change, human activities, financialisation and globalisation are essentially moral questions over the power to lead us out of the wilderness of nuclear destruction through war or planetary burning.
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In his monumental “History of Western Philosophy” (1946), British philosopher Bertrand Russell argued that those in power understand that they have twin powers over nature and political power to rule other human beings.
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Traditionally, the limits to such power have been God and truth. But today, religions are also in turmoil on what is their role in finding pathways out of the current mess. Furthermore, FakeNews obscures what is truth.
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The current mess is not unlike the Lost People wandering in the desert waiting for Moses to find the 21st century version of the 10 Commandments. Unfortunately, the 17 UN Sustainable Development Goals (SDGs) are aspirations and not commandments.
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As economists say, climate change is a market failure, but there is no modern day Moses nor operating manuals to translate SDGs to environmental, social and governance (ESG) projects and programmes for businesses, governments and social institutions.
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In this twin injustices against man and nature, people sense that there is both a moral vacuum in globalised modernity, as well as lack of a shared, practical pathway out of planetary destruction. If secular science or politics cannot help us, is religion the solution?
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Ironically, religion has played a far larger role in the current quandary than meets the eye.
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Two papal bulls empowered the Portuguese and Spanish conquests of new land in the second half of the 15th century. Papal bulls are public decrees, letters patent or charters issued by a Catholic pope.
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The Papal Bull Romanus Pontifex issued by Pope Nicholas V in 1455 gave Portuguese King Alfonso the right to “invade, search out, capture, vanquish and subdue all Saracens and pagans whatsoever, and other enemies of Christ whatsoever placed, and the kingdoms, dukedoms, principalities, dominions, possessions and all movable and immovable goods whatsoever held and possessed by them and to reduce their persons to perpetual slavery... to convert them to his profit... [such assets becoming] justly and lawfully acquired.”
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The Papal Bull Inter Caetera, issued after Christopher Columbus returned from America in 1493, not only reinforced the Spanish right to property and slavery seized or colonised from non-Christian kingdoms or pagan natives, but also established the Doctrine of Discovery.
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This doctrine formed the basis of national and later international laws that gave licence to explorers to claim vacant land (terra nullius) on discovery. Vacant land meant land not populated by Christians, and thus the Christian discoverers and occupiers could have legal title to them, regardless of the rights of the indigenous people.
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In short, historically it was the Church that gave the moral blessing for colonisation, slavery and genocide during the Age of Globalisation. The tragedy is that the Doctrine of Discovery is now embodied in US laws.
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In the historic case of Johnson vs McIntosh (1823), Supreme Court Justice John Marshall ruled: “According to every theory of property, the Indians had no individual rights to land; nor had they any collectively, or in their national capacity; for the lands occupied by each tribe were not used by them in such a manner as to prevent their being appropriated by a people of cultivators. All the proprietary rights of civilised nations on this continent are founded on this principle. The right delivered from discovery and conquest, can rest on no other basis; and all existing titles depend on the fundamental title of the crown by discovery.”
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If humanity still treats nature as a free asset to be mastered, and other human beings to be dominated and disenfranchised because of the Doctrine of Discovery, how can we move forward morally to create human inclusivity and planetary justice?
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Under secular science, the elites that control the media, military, economy, political or social institutions have forgotten that they are not masters of man and nature, but stewards to protect human well being and nature for future generations.
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In this polarised age, we forget that the shamans of the indigenous people carry ancient wisdoms about how to live with nature and each other through traditional values, medicine and shared rituals. The shamans are not seers but healers and carriers of tribal memories and values.
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When modern scientists and technocrats have no solutions to present problems except more speed, scale and scope in the rush to modernity, isn’t it time to listen to traditional wisdoms from those who have living but dying memories of how to live with nature and each other?
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Without moral bearings, no wonder we have no maps out of the current mess.
Generating revenue: A visitor walks past a sculpture for the Beijing Winter Olympics. The games are expected to fuel more opportunities for businesses in related fields. — AP
Interest in ice and snow sports tourism is booming
BEIJING: In the countdown to the February start of the Beijing 2022 Winter Olympic Games, ice and snow tourism has picked up among Chinese consumers.
The games are also expected to fuel more opportunities for businesses in related fields. With the new snow season beginning in China, enthusiastic skiers and snowboarders have been eager to get back on the slopes.
One drag on the demand for some travel related to winter sports may be the small number of new cases of Covid-19 that have popped up sporadically in some regions.
But that will depend on the pandemic prevention and control situation this winter, industry experts said.
Beijing and Zhangjiakou in Hebei province have established a group of venues to provide services for the Winter Games, including the Beijing-zhangjiakou high-speed railway.
Over the long term, that infrastructure is expected to become additional assets for the country’s tourism based on ice and snow.
The ski venues in Zhangjiakou, about 200 km northwest of Beijing, will host the snow sports events of the Winter Games. In the past few years, the popularity of the ski resorts there has grown, although a few resorts will be closed for the games next year.
A number of landmark Winter Games venues were designed with the idea of continuing to drive tourism after the Olympic and Paralympic Games.
“Those venues are expected to become new hot spots after the games.
“Aside from traditional sports such as ice-skating and skiing, more innovative entertainment is expected to emerge and create new experiences for consumers,” said Cheng Chaogong, chief researcher with the tourism research institute of Suzhou-based online travel agency Tongcheng-elong.
“The improvement of transportation facilities and other infrastructure has further expanded the growth potential of the cultural and tourism sector in Beijing and in surrounding areas.
“Zhangjiakou is set to become a landmark destination for winter tourism, and the winter tourism market in Beijing will also get a boost,” Cheng added.
Previously, most people who went to ski slopes in Beijing, Tianjin and Hebei province were locals. With major new development in the region aimed at serving skiers, those resorts have been attracting more tourists from other parts of China.
Those tourists aren’t just from North China. People from Shanghai and Guangdong and Jiangsu provinces, for example, have shown a great deal of enthusiasm for the Winter Games and ice and snow tourism.
The potential increase in the number of tourists from southern and eastern China is bound to give a boost to Beijing’s tourism market, according to the Tongcheng-elong institute.
The Winter Games events that tend to draw the greatest public interest include short track speed skating, speed skating, freestyle skiing, snowboarding and curling, experts said.
Ice and snow sports have become increasingly popular, and lots of people also like to participate in fun activities such as skipping rope in the snow, snow bowling and playing soccer in a field of snow. — China Daily/ANN
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