World Energy Market

[Xenon54]

Actually Ukraine war helps China in foreign trade and future consolidates China's dominant role in the global supply chain. A bonus kill is discounted Russian energy supply to China, if Russia cut off EU energy supply, Russia will be actually helping killing China's manufacturing competitors in Europe and making Europe more reliant on the Chinese products, either way is a big win for China.

Supply Chain Latest: China Trade Surplus Hits a Record

Supply Chain Latest: China Trade Surplus Hits a Record Bloomberg News 2022年7月13日 GMT+8 下午7:00 People keep prophesizing about how China will suffer in a new era of retreating globalization and supply-chain reshoring, but the latest official numbers show no weakening of its standing as a trade...

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The surplus comes from high demand after the pandemic years, what do you think is gonna happen once your biggest customers demand decline?

 

[Jagdflieger]

Actually Ukraine war helps China in foreign trade and future consolidates China's dominant role in the global supply chain. A bonus kill is discounted Russian energy supply to China, if Russia cut off EU energy supply, Russia will be actually helping killing China's manufacturing competitors in Europe and making Europe more reliant on the Chinese products, either way is a big win for China.

If Europe economically bites the dust - then yes automatically European suppliers (who also source from China) will go down as well - But then Europe's OEM's will go down too - resulting in an even lesser demand of supplies across the board incl. those from China. Logically lower consumer spending in Europe due to an economic crisis will again also impact imports from China. China presently has lost already substantial business with Russia - which is not compensated by buying cheaper oil from Russia - also Ukraine with a rather large market is presently in no position to buy from China as it could have done without the war.

This ridiculous war only serves US global interests towards (Europe) and Putin's dream of a larger Russia.

 

[xizhimen]

The surplus comes from high demand after the pandemic years, what do you think is gonna happen once your biggest customers demand decline?

As long as China can get a bigger share of the global supply chain, all will be in China's favor in the long term after all the dust settles down. US can not fill the void left by Europe if Europe bites the dust, but China can.
China's past success never lied with short sighted immediate interests, the country's leadership always have an eye for the future.

 

[Jagdflieger]

China's past success never lied with short sighted immediate interests, the country's leadership always have an eye for the future.

Exactly - that is why Beijing isn't happy with Russia - since it has negative implications, that China incl. it's own Covid measure implications had NOT foreseen in it's long term planing.

 

[xizhimen]

Exactly - that is why Beijing isn't happy with Russia - since it has negative implications, that China incl. it's own Covid measure implications had NOT foreseen in it's long term planing.

Of course China doesn't want to see this war, but since China can do nothing to stop this war, China might as well adjust her position accordingly and try to make the most of it.

 

[Jagdflieger]

Of course China doesn't want to see this war, but since China can do nothing to stop this war, China might as well adjust her position accordingly and try to make the most of it.

Well - everyone on this planet is "adjusting" or at least trying in view of this war not just China. But your initial statement was:

Actually Ukraine war helps China in foreign trade and future consolidates China's dominant role in the global supply chain.

And this war - certainly is NOT helping China towards foreign trade or......

 

[Xenon54]

As long as China can get a bigger share of the global supply chain, all will be in China's favor in the long term after all the dust settles down. US can not fill the void left by Europe if Europe bites the dust, but China can.
China's past success never lied with short sighted immediate interests, the country's leadership always have an eye for the future.

Europe is arguably the most premium market area in the world, nobody is gonna pay the prices for your products that europe does.
How fast you forget how much Chinas exports dropped in 2009 crisis, wanna guess why China out of all started buying US debt bonds?

 

[xizhimen]

Well - everyone on this planet is "adjusting" or at least trying in view of this war not just China. But your initial statement was:

Actually Ukraine war helps China in foreign trade and future consolidates China's dominant role in the global supply chain.

And this war - certainly is NOT helping China towards foreign trade or......

China is against this war not only for economic reasons, Chinese foreign policy's corner stone is noninterference in other countries domestic issues. what I said only reflect my personal opinions, I believe this war actually can turn out to be a blessing in disguise for China if we see it from the lens of the possible long term outcome and redivision of the global supply chain share. US and EU will be more troubled and challenged by this war than China, this war unintendedly took a lot of heat off of China and gave some unexpected wiggle room to China in dealing with the west. and one of China's best assets is her ability to turn an adverse situation into something in China's favor, as for what this ongoing war will pan out in the future, let's wait and see.

 

[xizhimen]

Europe is arguably the mosrt premium market area in the world, nobody is gonna pay the prices for your products that europe does.
How fast you forget how much Chinas exposrts dropped in 2009 crisis, wanna guess why China out of all started buying US debt bonds?

I believe this war will inherently lead to major divisions between Europe and US and even EU itself because of the obvious clash of interest between themselves, something that China can conveniently exploit.

 

[xizhimen]

Before Ukraine war, US actually tried to rope in even Russia to counter China, Ukraine war totally killed this US dream and US now struggles to balance their global priorities but two conflicting voices within their establishment make US government hard to make up their mind. It's a blessing for China.

 

[Jagdflieger]

Before Ukraine war, US actually tried to rope in even Russia to counter China, Ukraine war totally killed this US dream and US now struggles to balance their global priorities but two conflicting voices within their establishment make US government hard to make up their mind. It's a blessing for China.

You are changing the topic from economics to politics. That China is now more free to move around politically - yes, but we will see, since it entirely depends on China's "support" towards Russia.

Economically China is already badly hit due to trade sanctions still ongoing, plus Covid and now the Ukraine war.
China depends absolutely on Export - since (see our other discussions) the domestic markets consumption is nowhere near expectations - and won't be for another 20-25 years. And a weak EU and or a weak world-market certainly won't contribute towards China's growth. Which again is essential for China with an estimated 100-150 million people (roughly 30% of the workforce) without a regular income since mid of last year. - not just due to Covid. But mostly from competing low cost countries and the ongoing relocation of the supply chains by the USA, EU, Japan, Korea and even Taiwan in regards to it's world dominating chip industry.

That Beijing can "control" such a situation and the effected population far better in contra to democratic countries is certain. But that doesn't help in regards to finding export customers and replacing lost jobs due to supply chain relocations. As such a weak EU and a weak world market increases those existing internal problems for China even more.

 

[Bogeyman]

https://twitter.com/i/web/status/1548269133300543499

 

[Bogeyman]

https://twitter.com/i/web/status/1548269133300543499

It is said that Germany's nuclear power plants do not lack any shortcomings, only "political" approval is required to start production again. If the news is true, the Germans are shooting themselves in the foot.

 

[Blackbeardsgoldfish]

It is said that Germany's nuclear power plants do not lack any shortcomings, only "political" approval is required to start production again. If the news is true, the Germans are shooting themselves in the foot.

Scholz is one of the worst postwar chancellors. Brandt and Schmidt are rolling in their graves.

 

[Xenon54]

I believe this war will inherently lead to major divisions between Europe and US and even EU itself because of the obvious clash of interest between themselves, something that China can conveniently exploit.

Right now the war is doing exactly the opposite, NATO members are more comitted to bolster their militaries and the US is replacing Russian gas even if the price is higher.
All Russia managed to do is to block energy supply to Europe and kickstart a global recession that will also not go by from China without a trace, the officials in Beijing are fully aware of this fact hence the unusual tone towards Russia regarding war.

 

[Xenon54]

https://twitter.com/i/web/status/1548269133300543499

Dont understand supid german politics of shutting down nuclear plants and and going back to coal power, thats like going back a century...

 

[xizhimen]

Right now the war is doing exactly the opposite, NATO members are more comitted to bolster their militaries and the US is replacing Russian gas even if the price is higher.
All Russia managed to do is to block energy supply to Europe and kickstart a global recession that will also not go by from China without a trace, the officials in Beijing are fully aware of this fact hence the unusual tone towards Russia regarding war.

As long as this war drags on, EU won't have a free hand to shift their focus on containing China as US wished for and they will grow more reliable on China for trade and products. EU 's interests are not totally aligned with US and eventually but surely this will lead to division between the two, if not today, will be tomorrow. and Russia's war makes NATO's priority having to stay on Russia, this takes lots of heat off China's defence needs.

 

[xizhimen]

Before Ukraine war Russia and Europe were good buddies, Trump and Putin were pals and US can easily rally EU into their joint goal of countering China and checking China's rise, now EU cares more about getting China's support to counter Russia's war, suddenly China got a huge bargainning chip with the west and their anti China alliance was suddenly disrupted or at least greatly weakened, this is why I call Ukraine war a blessing in disguise for China.

 

[Jagdflieger]

Politically there is an opportunity for China in regards to the EU due to this war. But again - it depends all on China's "neutrality" in regards to Russia. (which I personally find doubtful - since it is obvious that China can't afford or allow itself for Russia to become an economic nobody and at the same time a political liability).

As such China is "gambling" heavily onto a EU disunity in regards to Russia and also towards the USA (see your own posts) - something that both the EU and USA are clearly aware off. And in case off a Russian defeat, or even a peaceful solution to Ukraine, both will certainly keep this in mind.

Europe has been under US control/influence now for around 75 years, and Eastern Europe for around 20-25 years, with a natural hatred/mistrust towards Russia. And China is offering as an alternative to the USA? we control your supply chain, and you need our products.

Since 2012 China in every dispute has been pointing out it's economic prowess and military strength - I am not aware off a single dispute that has been laid off due to a "friendly" diplomacy of give and take. The present India/China dispute (see your own post) is now maybe being laid to rest, simply due to India having to recognize that they do not have the economic and military strength to "defend" their point of view or interests.

As I stated before, China is following exactly the USA footsteps - we have the economic and military power - so do as we say.
The difference to the USA is, that China is propagating that kind of message to "controlled allies" of the USA (not some "neutral" union or state like India) and who additionally in basic, share the same values in regards to interpreting democracy, freedom and human rights.
Far more important - China is actually IMO, 20-25 years too early to get into such a power game with the USA and the EU.

So let's see in e.g. 5 years - were this "gamble" by China has led to. Living in China since around 2000, I can see very clearly that overall China's growth and development has slowed down considerably since 2014 leading to a large "dissatisfaction" among the Chinese population and it's private business community. Independent of China's GDP statistics that obviously are not helping in regards to reducing that dissatisfaction. It's just the already rich (and government controlled companies) are getting far more rich and dominating, then the poor improving upon their livelihood.

Undoubtedly a drastic change in USA policy is the prime cause for this (naturally they do not accept a rival) - but it was primarily enabled, via China's own overall policy shaping up from 2012 onward. Someone fired the cannon too early - it will be interesting to watch though.

 

[xizhimen]

Trump fired the first shot at China, it caught China off guard but there's nothing China can do about it. In the thick of US effort to rally global support for its fight against China, Russia suddenly openned the second battle front in China's favor, which totally disrupted US planned global strategy.
Anyone in their sane mind can clearly see that the only choice for China is support Russia, otherwise the combined weight of western containment will be solely borne by China. The same goes to Russia side too. If China and Russia have to form a coalition, that coalition is larged forged by the west.