Japan’s Nikkei Asian Review reported on July 9 that Zhou Li, former deputy head of the Chinese Communist Party’s International Liaison Department, revealed that there is a latent possibility of decoupling between the Chinese Communist Party (CCP) and the United States and a global division into economic blocs in dollars and yuan.
The article written by Zhou ended up being published by the Chinese Academy of Social Sciences despite the fact that it sheds light on a view of the CCP’s economy that is far removed from the official documents prepared by the Party.
“Many international economic organizations such as the International Monetary Fund have issued reports downgrading global economic growth this year to as much as minus 4.9%, the worst economic recession since the Great Depression in the 1930s,″ Zhou wrote in the article.
Zhou listed six possible consequences that await the country amid the health alarm generated by the CCP (Chinese Communist Party) Virus pandemic, or new coronavirus:
1. For the deterioration of Sino-U.S. relations and the full escalation of the struggle.
2. To cope with shrinking external demand and a disruption of supply chains.
3. For a new normal of coexisting with the novel coronavirus pandemic over the long term.
4. To leave the dollar hegemony and gradually realize the decoupling of the yuan from the dollar.
5. For the outbreak of a global food crisis.
6. For a resurgence of international terrorism.
As Zhou pointed out in the article quoted by the Nikkei Asian Review, confirmed orders from Chinese exporters has been considerably reduced, as well as the production by domestic companies. He also said that international transport logistics were frozen.
“This phenomenon is putting huge pressure on our stable growth and job security,” Zhou added, emphasizing that the CCP’s situation is now so tough that it could mean zero growth in its economy.
According to National Public Radio, in the face of the difficult economic outlook, some Chinese workers and business owners have joined together to pressure companies or local governments for payments and subsidies.
“Say a factory used to hire 1,000 temporary workers; now, without new orders, these business owners can’t afford to hire this many people,” said XPR Yan Xiyun, a labor broker.
“The factory I usually go to in previous years could easily hire 2,000 people. Now there is scarcely anyone [on the factory floor],” Yan added.
Many of the workers in the industry have been forced to return to the countryside to seek work opportunities, and a large majority of them are migrant workers who now take on agricultural work on small family plots, according to NPR.
Zhou also predicted that now that supply chains have been disrupted, the 5G strategy by Chinese technology giant Huawei could be seriously affected.
Beijing-based independent economist Hu Xingdou referred to the words of Chinese leader Xi Jinping, who said that Beijing was giving up on its strategy of high professional circulation. For Hu, “It is a kind of preparation for the worst case scenario, including decoupling with the United States and even the entire Western world.”
Zhou said that until now it has been taboo in China to talk about the situation that could be deteriorated by “the new cold war,” referring to the political and economic tensions currently developing between the United States and Chinese Communist Party.
“In the six months since the outbreak, the U.S. ruling authorities—including the Trump administration and the U.S. Congress–have continued to strengthen their pressure on China,” Zhou said in the article published by the Chinese Academy of Social Sciences.
As the Nikkei Asian Review pointed out, amid a compilation of articles praising Xi’s concept of a “community with a shared future for humanity,” Zhou’s article stands out oddly enough, generating a sea of speculation about why the CCP dared to reveal an end-of-the-world scenario.
According to the Nikkei Asian Review, a direct interpretation of Zhou’s article would be an attempt to control preventive damage before a sudden movement toward decoupling, which could lead to social unrest.