https://www.innovationfiles.org/top-9-false-promises-that-china-made-in-joining-the-world-trade-organization/

This article above explains the 17 years of inaction on those fronts. those same vague promises are getting way too stale now. The article below tells of the new repetition of the same spiel. The reason they will never do those things is the CCP wants full control without paying the price.

https://www.dawn.com/news/1448193/chinas-xi-vows-to-better-protect-intellectual-property

more Ideological non-sense hurting foreign businesses:

https://thediplomat.com/2018/08/foreign-companies-should-give-up-their-china-fantasy/

With its increasingly large economic and diplomatic power, China is attempting to force foreign corporations and business entities to comply with its own ideological beliefs, such as recognizing Taiwan as part of China. In addition to achieving diplomatic gains, China also aims to gain more control over economic activity by setting up CCP organizations within foreign corporations. In 2017, German businesses in China threatened to quit their operations in China to protest against the state’s attempt to influence the foreign enterprises. China has a long history in setting up Communist Party divisions among foreign businesses. According to a 2007 Beijing Daily report, foreign enterprises such as Siemens, PwC, and Citi Bank all have their respective Party divisions that manage CCP members working within the company.

From the Diplomat (I disagree with point 3):

First, the main leverage the Trump administration has for forming such a coalition is the size of the U.S. market. But the Chinese market is larger today for many products, from cars to groceries, and is expected to be the largest soon for pretty much everything. Even though there are restrictions for some goods and services, most of the Chinese market is quite open, and advanced country producers are already taking full advantage through exports and production in the country. Foreign-funded enterprises, which are mostly firms from advanced economies producing for the local market, account for more than 15 percent of the industry profits in the country. Including those from Hong Kong and Taiwan, which produce more for the export market, about a quarter of all industrial profits in China are made by non-domestically funded firms. In fact the most profitable premium segments of the markets for most consumer and producer goods in China today are dominated by companies from advanced economies, with domestic producers holding the price-sensitive lower segments. Consequently other countries, especially the advanced economies and others that aspire to that status, will not easily trade access to the Chinese market for the U.S. one, if it comes to that.

Second, even though some countries may share the Trump administration’s concerns about China and others may have their own worries, unlike (apparently) the Trump administration, the issues most of these countries have are not big enough to take the economic and political risks of an economic war, which is not at all guaranteed to stay economic. A China completely broken in this conflict would not serve the national interests of many either; for most countries, a world ruled by China holds risks, but so does one ruled by the “America First” principle. Many of the emerging economy countries, themselves likely harboring own versions of the “Made in China 2025” plan or Chinese Dream, are not likely to become staunch opponents of government-led economic development either. Consequently most countries in the world, rather than taking an active part in this conflict, are likely to use it to shape the policies of the two sides to their best national interests and try to try to maintain a state of balance of power between them.

Third, with its Belt and Road and similar initiatives China has become a significant source of investment and finance for many countries in the world, with an impact on their international policies. The United States does not have the resources to compete with China in this arena. In 2017, the United States’ and China’s GDPs in purchasing power parity terms were $19.4 trillion and $23.3 trillion, respectively; their national savings rates were 18 percent and 48 percent. This puts their national savings, the amount of resources that can be spent on investments, at about $3.5 trillion and $11 trillion. Considering that its government has stronger control over the use of these resources, the amount China can spend on strategic domestic and international projects is much larger.

This article explains the real world of global finance based on real exchange rates, not an economist’s estimates of PPP.

http://theconversation.com/chinas-economic-power-is-actually-a-lot-smaller-than-you-think-8830

China’s economic presence on world markets is actually much smaller than that of the United States of America and smaller than our key three asia-pacific allies combined.


China’s size is a good indicator of potential economic opportunities for Australia. But China’s rise is also creating a growing discomfort in how China will use its economic power. In both Washington and Canberra questions are being asked about how to our balance economic interests with these growing political and security concerns.

As a large country China may insist on a greater acceptance of its own ideals and priorities as a condition of economic engagement. As a dictatorship, however, its ambitions are unclear and may not align well with Australia and other democratic countries in the region.

Likewise China’s assertiveness in the South China Sea has rekindled interest in security cooperation between the region’s largest democracies, Japan, India and Australia, as well as the United States through the Quadrilateral Security Dialogue.

The concerns raised are real, but are in some ways exaggerated. Specifically, the figure of US$19 trillion is an estimate based on a purchasing power parity exchange rate, which overstates China’s impact on world markets.

This is because the purchasing power parity exchange rate tells us how much money you need in China to be as well off as you are in the US. It is a measure of how big China’s GDP would be if costs of living were the same as the US.

This can be useful, but it is not an indicator of China’s footprint in the world economy.



A reasonable measure of a country’s economic footprint on the world economy is how much it could potentially change demand or supply on world markets.

When countries export they have to accept payment based on market exchange rates. Likewise when countries import they must pay in foreign currency based on market exchange rates. This means that to compare China’s market size with the US, we need to convert China’s GDP, measured through China’s currency renminbi, to US dollars, using market exchange rates.

China’s GDP measured at market exchange rates, however, is only US$9 trillion – almost half that of the US.

This means that the impact China’s economy can potentially have on the world economy is really only about half as much as the US.

The difference in values arises for the same reason that tourists find that their money often goes much further in developing countries. That is if you convert your US dollars to renminbi, you will find that you can purchase a lot more in China than the US, especially in non traded goods and services such as haircuts or street food.

The purchasing power parity exchange rate is the rate that tells you how much you need in China to be just as well off – for example to buy the same basket of goods. It’s very useful rate for tourists and is great way to compare standards of living across countries.



But it’s not a measure of how much you can actually buy. In order to measure the potential influence of China’s economy, it is buying and selling power that matters.

The same line of reasoning also effects how we should think about the asia-pacific partnership of regional democracies. The combined GDP of India, Japan and Australia, measured at purchasing power parity rates is smaller than China.

But at market exchange rates their combined market size exceeds that of China. This is because just as purchasing power parity exchange rates make China seem too big, they make Japan seem small relative to its real buying and selling power on world markets.

The collective GDP of Japan, Australia, India and the United States represents a market that is around three times larger than China.

Now Vietnam is benefiting from the exodus of Chinese factory owners.

https://www.scmp.com/economy/china-economy/article/2175432/twist-trumps-trade-war-manufacturers-are-fleeing-china-just

“At some point, the whole industry is going to come to terms [with the fact] that there’s just not enough capacity domestically, there’s not enough capacity in other parts of the world and Vietnam today does not have the capacity that China has,” said Kevin Castellani, director of corporate communications at Man Wah USA.

Schewel said his company was considering three options, each of which presented challenges.

It could keep buying Chinese-made furniture and pass the extra costs on to the consumer, which was likely to result in lost sales; try to buy more product from Southeast Asian countries, where capacity or quality is not assured; or buy more US-assembled products, which may be too expensive for the store’s core customers. For now, the plan is to import as much inventory as possible before a potential tariff escalation, Schewel said.

This Editorial expresses the reality on the ground:

https://www.scmp.com/comment/insight-opinion/united-states/article/2175373/francis-fukuyama-china-us-relations-will-get

I think the relationship is going to continue to be bad and this is not just the result of Trump being in office. I think there’s a real shift in the business community in the United States, and in Europe, which has become much more hostile to China. They used to be the most favourable in terms of wanting a good relationship with China but I think that has all changed because they felt they had not been treated fairly. So I would expect that things are going to get worse before they get better in US-China relations.