Waking up to the news that China is already starting to ease its zero-Covid policy with new evolving and dynamic zero-Covid protocols as well as roll-out of the fourth vaccine for the elderly and vulnerable brightened the start of the day.
The world has been waiting for this moment when China starts opening up its economy fully adjusting to the Covid endemic world after detecting the decline of the severity of the variants emerged from the past two years of virus mutations.
Earlier, President Xi Jinping had already opined that Covid in China is “less lethal” to the visiting European Council President Charles Michel in the first week of November, a signal to the world that China’s normalization of the pandemic restrictions would be eased.
China has indeed acted in the most responsible way with the Covid 19 crisis, protecting its naton of 1.4-billion people from the ravages of the infection reducing deaths over the entire crisis to just around 5,000 and cases to 367,627 with 326,052 recovering.
Other countries who criticize China’s strict anti-Covid policies like the U.S. suffered 1,110,166 deaths and over 101-million cases of infections, supposedly suffered 530,658 deaths and 44,676,368 cases but may actually be ten times more.
The U.S. complains that China refuses to accept for use U.S. MRNA vaccines to augment its supply for China’s vaccination needs, but China has a point in being careful with the U.S. vaccines, particularly its mRNA type which has been associated with myocarditis and pericarditis.
China’s recovery during this period of normalization will be fast because its robust fundamentals have all been preserved through the pandemic period and in the past year economic growth has resumed even if the West and Europe in particular continues its path towards recession.
One of the most exciting news coming out of China’s post-Covid 19 active -re-engagement with the world is the state visit of President Xi Jinping to Saudi Arabia, and his meeting with the Arab heads-of-state at the first ever China-Arab Summit.
The Global Times reported, “Strengthened China-Saudi ties raise prospects for use of yuan in oil settlement”. All the other major international and Western newspapers reported the same but in a more forward tone like Reuter’s “China’s Xi calls for oil trade in yuan at Gulf summit in Riyadh.”
I always check Western reports with the Global Times to ensure accuracy, and I note that the Global Times report is more modest in its tone than the Reuter’s “call” for use of the Yuan. Chinese diplomacy and reportage is never presumptuous but always rather polite.
Various observers and analysts say President Xi would not have broached the proposition if it were not with the clearance of the Saudi leadership, particularly Crown Prince bin Salman, so it looks clear that we are facing a new era of international finance and economics.
Kathleen Tyson of the Pacemaker Global website wrote on December 9, 2022 that the Xi announcement means the “Bretton Woods II ended today”/ Bretton Woods II is the moment the U.S. under President Nixon decoupled from gold and created the U.S.-Saudi Petro-Dollar.
The U.S. abuse of the US $ and President Nixon unilaterally abrogated the US treaty obligation under Bretton Woods to redeem dollars for gold in 1972 created chaos in foreign exchange markets that followed led to instability, made worse with the inflationary OPEC oil embargo of 1973-74.
That chaos in the world’s currencies has not left us since then as the US fiat currency destabilized all currencies and especially depressed Third World currencies that led to the massive debt trap on the US and its international financial institutions such as the World Bank, et al.
That currency chaos is soon to end as the Saudi’s frees itself from the U.S. $ courtesy of the opening China provides in buying from the Saudi 25% of its total crude oil exports while importing hundreds of billions of goods, technology, infrastructure and finance from China.
While nobody is certain when or if there are already actual transactions of Saudi oil for Chinese Yuan going on right now, it is expected that it will soon be surfacing for all to witness and ride on. The care with which the Saudis are approaching this is understandable, watching out for U.S. backlash.
The pressure on the U.S. $ from tis news as well as the China, Russia, Japan unloading of U.S. $ assets have helped ease the speculative pressure boosting the $, and countries like the Philippine recovering from P60 back to P 55 to the $ is a welcome relief.
When the Chinse Yuan for Saudi oil becomes public reality then a major readjustment, some say a collapse, of the values of the $ will hit the currency markets. Pressure on the developing world now besieged by inflationary prices will ease and the world will again be a better place to thrive in.
President Bongbong Marcos in matter of three weeks will be paying his sate visit to China, shake hands and engage in talks with President Xi Jinping. I hope he keeps in mind the hopes of the Philippines, as does that Asia and the world fro advancement, depends on full cooperation with China.