China opted not to set a GDP target for 2020. Photo: Xinhua
Zhang Lin, SCMP: Is Beijing preparing to decouple from the US?
* China’s leadership has made it clear to its people that the world will become more dangerous and they must be prepared for hard times
* Beijing’s relatively small stimulus response to Covid-19 suggests it wants to save its economic policy ammunition for a bigger battle
Beijing’s decision not to set an annual GDP target for 2020 – for the first time since 2002 – is a sign it is putting stability ahead of growth as part of its preparations for an escalating conflict with the United States.
Economic development has always been the central theme for Beijing since it established diplomatic relations with the US in 1979. But this year it has given priority to job creation and tackling poverty. The coronavirus outbreak might appear to have been the reason for the shift, but the underlying factor is the tension with the US.
Covid-19 offered a preview of what a decoupling of China and US might look like: aircraft grounded, cargo flows disrupted, value chains broken, goodwill and cooperation lost, blame games started.
Both countries have suffered heavy human and economic losses from the coronavirus, yet that did not inspire them to work together. Instead, hostility and rivalry has thrived, and neither wants to blink first.
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WNU Editor: I disagree with the above author’s conclusion that the reason why Beijing did not set out an annual GDP target for 2020 is that they are putting stability ahead of growth as part of its preparations for an escalating conflict with the United States. GDP growth is what has kept China stable for the past few decades, and what has been instrumental in that growth are those multiple $400 billion trade surpluses with the US each year. This is why the U.S. decoupling away from China is going to hurt China in the long term, and why future historians will look back at this time and try to figure out why China decided to choose this path of economic hardship when they should have pursued a policy of compromise and accommodation.