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Could Europe benefit from de-dollarisation?

"This way to multipolarity." Credit: Getty

March 30, 2023 - 6:00pm

This week Brazil and China reached a deal to trade using their own currencies rather than the US dollar. The Chinese are fulfilling their vow from February to open up a clearing house to settle yuan-denominated trades in Brazil, having previously announced similar clearing houses in Pakistan, Kazakhstan, and Laos.

In many ways, this development is inevitable. As of 2021, China accounts for 31.3% of Brazilian exports and 22.8% of their imports, the most of any country. The United States comes a distant second, accounting for only 11.2% of Brazilian exports and 17.7% of imports. China has been Brazil’s largest trade partner for fourteen years. At a certain point, both parties were going to raise the question of why their trade should use a third party currency.

The same day that the Brazilian trade deal was announced, another major story hit global currency markets: China settled its first LNG trade in yuan. This development alone would be important enough to bear scrutiny given that much-vaunted status of the US dollar as an energy currency — the ‘petrodollar’ — but reading beyond the headlines reveals something even more surprising. The trade was not settled with an energy company in some far-off Middle Eastern country, but instead with TotalEnergies, the French supermajor. With revenues of over $182bn and more than 100,000 employees, TotalEnergies is by far the largest company in France. 

This energy deal suggests that ‘yuanisation’ will not be confined to the global periphery. Until recently, suggestions that the BRICS+ countries would dump the dollar and move to new currencies was met with derision. The Brazilian trade deal puts that scepticism firmly to bed. But it now appears that the yuan is making inroads into Europe. While the speed of this change is shocking even to those of us paying attention, these developments were presaged by German Chancellor Olaf Scholz’s controversial visit to Beijing last November.

The question that logically follows this is cui bono – to whom does this benefit? Obviously, yuanisation puts wind in the sails of the Chinese. Their goal is clearly to carve out an alternative global trade regime to rival the American-led model that has been in place since 1945. The countries that jump on board the BRICS+ bandwagon are also likely to be beneficiaries.

The most obvious loser is the United States. Currency use in global trade is a zero-sum game. Every yuan that changes hands for goods and services on the global markets is a dollar that did not change hands. America has long relied on the hegemonic status of its currency for both its ability to consume more than it produces and for its soft power projection. America’s geopolitical strategy, largely centred around imposing sanctions regimes, unravels if there are credible alternatives in place.

The situation for Europe is less clear, as recent developments there demonstrate. The Europeans have long been unhappy with playing second fiddle to the Americans in global economic relations, and counteracting this was part of the rationale for launching the euro around the turn of the millennium. Scholz’s Beijing visit signals that Europe could try to position itself between America in the West and China in the East, a potentially useful long-term ploy to benefit from developments in both large economies.

Britain, on the other hand, is in an unusually vulnerable position. Since the 1980s, British manufacturing has declined dramatically, and British living standards have become increasingly reliant on a financial services sector concentrated in the City of London. In reality, the City is an outpost of American financial power. This means that dedollarisation makes the City less important on the global stage — and the process may even trigger an American reaction to onshore their financial services, thereby dealing a punishing blow to Britain.

The City has been under pressure for some time now. Large FTSE-listed firms have been moving to New York, while IPOs have been falling off a cliff. Prior to the American turn against China, the City looked set to be a major player in yuan trading. But this seems unlikely now that Sino-American relations have soured, so joined at the hip are Britain and the US in their foreign policy. In fact, if Britain ever did want to pursue the balancing act being attempted by the Europeans, the country would likely have to re-join the European Union — with all the problems that raises. All the while, China’s influence can only spread, and the European mainland may well be a key part of that.


Philip Pilkington is a macroeconomist and investment professional, and the author of The Reformation in Economics

philippilk

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Hugh Bryant
Hugh Bryant
1 year ago

Hopefully the Americans will eventually wake up to the corruption of their politics and the damage being done by the ludicrous ‘women have pen1ses’ delusions and realise that the world is still the Hobbesian place it’s always been.

Peter B
Peter B
1 year ago
Reply to  Hugh Bryant

Don’t worry. They’ll be fine. They eventually corrected the madness of Prohibition. That’s the key advantage of the West – for all the imperfections, Western democracies aren’t locked to an ideology and can learn and adapt.
I find the prophets of Western doom here ludicrous. Wishful thinking.

Paul M
Paul M
1 year ago
Reply to  Peter B

Down the street from my friend’s house, in a not-so-poor area of the city, a 12 year old just killed his 34 year old neighboor for guns. Crazy thing is, this is not an abnormal ocurrance. No, I do not think we’ll be fine. I don’t think we’ve been fine for a long long time.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Peter B

I fear it is you that is doing the wishful thinking.

tim richardson
tim richardson
1 year ago
Reply to  Peter B

Me, too. I gave you a thumbs up but it’s astounding that 15 other people gave you a thumbs down.

Paul M
Paul M
1 year ago
Reply to  Peter B

Down the street from my friend’s house, in a not-so-poor area of the city, a 12 year old just killed his 34 year old neighboor for guns. Crazy thing is, this is not an abnormal ocurrance. No, I do not think we’ll be fine. I don’t think we’ve been fine for a long long time.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Peter B

I fear it is you that is doing the wishful thinking.

tim richardson
tim richardson
1 year ago
Reply to  Peter B

Me, too. I gave you a thumbs up but it’s astounding that 15 other people gave you a thumbs down.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Hugh Bryant

Was it Hobbesian before Hobbes?

Ralph Hanke
Ralph Hanke
1 year ago
Reply to  Liam O'Mahony

A nasty, brutish, and short question I must say.

Ralph Hanke
Ralph Hanke
1 year ago
Reply to  Liam O'Mahony

A nasty, brutish, and short question I must say.

Peter B
Peter B
1 year ago
Reply to  Hugh Bryant

Don’t worry. They’ll be fine. They eventually corrected the madness of Prohibition. That’s the key advantage of the West – for all the imperfections, Western democracies aren’t locked to an ideology and can learn and adapt.
I find the prophets of Western doom here ludicrous. Wishful thinking.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Hugh Bryant

Was it Hobbesian before Hobbes?

Hugh Bryant
Hugh Bryant
1 year ago

Hopefully the Americans will eventually wake up to the corruption of their politics and the damage being done by the ludicrous ‘women have pen1ses’ delusions and realise that the world is still the Hobbesian place it’s always been.

Brian Villanueva
Brian Villanueva
1 year ago

Somehow I don’t think people (or countries) will be interested in using the currency of a totalitarian, communist dictatorship as their foreign currency reserve. However, if they want to try, feel free.
To be fair, America has been behaving like financial authoritarians recently too, so I can’t blame people for looking for an alternative.

B Emery
B Emery
1 year ago

This has not happened because people are getting idealogical over who has the most moral currency.
This has happened because America has forced these countries, using sanctions and tariffs, into a parallel system.
By sanctioning and refusing to negotiate with russia and at the same time, starting a trade war with China, they put the last nail in the coffin of the petro dollar. My humble opinion.

Brian Villanueva
Brian Villanueva
1 year ago
Reply to  B Emery

I agree 100%. Those actions push people away from the dollar. I just don’t see a viable competitor right now for them to embrace. Diversification? Yes. Replacement with a new reserve currency? No.

B Emery
B Emery
1 year ago

I wouldn’t like to say. You could be right. Perhaps it’s not so much about how fast or slow the dollar might loose it’s status, it’s more how long can the US take the reshoring of all those dollars before it causes problems in our financial systems?

B Emery
B Emery
1 year ago

I wouldn’t like to say. You could be right. Perhaps it’s not so much about how fast or slow the dollar might loose it’s status, it’s more how long can the US take the reshoring of all those dollars before it causes problems in our financial systems?

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  B Emery

Since when have greedy money men been ideological, or moral?

B Emery
B Emery
1 year ago
Reply to  Liam O'Mahony

Well there is the fact that the system hasn’t exactly been run very well or even run according to basic economics as far as I can tell. Everything is a mess. And yes, trade and money rarely come down to idealogy, we need trade and money to live. Not idealogical really, just necessary.

Last edited 1 year ago by B Emery
B Emery
B Emery
1 year ago
Reply to  Liam O'Mahony

Well there is the fact that the system hasn’t exactly been run very well or even run according to basic economics as far as I can tell. Everything is a mess. And yes, trade and money rarely come down to idealogy, we need trade and money to live. Not idealogical really, just necessary.

Last edited 1 year ago by B Emery
Brian Villanueva
Brian Villanueva
1 year ago
Reply to  B Emery

I agree 100%. Those actions push people away from the dollar. I just don’t see a viable competitor right now for them to embrace. Diversification? Yes. Replacement with a new reserve currency? No.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  B Emery

Since when have greedy money men been ideological, or moral?

B Emery
B Emery
1 year ago

This has not happened because people are getting idealogical over who has the most moral currency.
This has happened because America has forced these countries, using sanctions and tariffs, into a parallel system.
By sanctioning and refusing to negotiate with russia and at the same time, starting a trade war with China, they put the last nail in the coffin of the petro dollar. My humble opinion.

Brian Villanueva
Brian Villanueva
1 year ago

Somehow I don’t think people (or countries) will be interested in using the currency of a totalitarian, communist dictatorship as their foreign currency reserve. However, if they want to try, feel free.
To be fair, America has been behaving like financial authoritarians recently too, so I can’t blame people for looking for an alternative.

Varnavas Christofi
Varnavas Christofi
1 year ago

Hopefully everybody realises that the world is many countries and we all have to cooperate. Between our selfs for the good of humanity ,so de-dollarisation is good for the world

Varnavas Christofi
Varnavas Christofi
1 year ago

Hopefully everybody realises that the world is many countries and we all have to cooperate. Between our selfs for the good of humanity ,so de-dollarisation is good for the world

Jon Hawksley
Jon Hawksley
1 year ago

The settlement currency is only important if the surplus funds are left in it boosting reserves in that currency. It will bring a spot light on the best reserve currency, a balance between stable exchange rates and interest rates.

Jon Hawksley
Jon Hawksley
1 year ago

The settlement currency is only important if the surplus funds are left in it boosting reserves in that currency. It will bring a spot light on the best reserve currency, a balance between stable exchange rates and interest rates.

Brian Villanueva
Brian Villanueva
1 year ago

Considering its backing government is a totalitarian communist dictatorship with a lousy track record of keeping its promises, I have a hard time seeing wealthy individuals, corporations, or governments wanting to hold the bulk of their foreign currency reserves in yuan. Being a reserve currency is more about politics than economics. Short of a unipolar Chinese world (which is highly unlikely due to China’s demographics) the yuan will be a short-term vehicle only.
However, that doesn’t mean those same people aren’t looking fo diversify from the dollar, and to be blunt, the Euro looks pretty good right now. Never thought I would say those words, but it has weathering two major downturns, the near bankruptcy of 3 member states, and a public health emergency. Could the Euro replace the dollar? Maybe.
As far as Britain is concerned, they’re on a long downhill ride to oblivion at this point. https://qph.cf2.quoracdn.net/main-qimg-7572d359298eebabdb76caac486129f7 The pound lost 70% of its value over 50 years, and has never recovered. It likely never will. As this article mentions, England is sucking on the teet of London’s foreign banking system. For the British pound to recover would require England to decide it wants to actually produce something again, and develop an industrial policy to accomplish that goal. Singapore on the Thames is a pipe dream.

Hugh Bryant
Hugh Bryant
1 year ago

The survival of the euro is entirely dependent on the willingness of the Germans to continue to subsidise the French, Italian, Spanish and Greek economies to the detriment of their own.

It seems unlikely that the French, having lived beyond their means and at someone else’s expense (including ours) since the nineteen sixties, will change their behaviour any time soon.

Consequently the hidden imbalances in Europe’s settlement systems will continue to grow for the foreseeable future until it is no longer possible to pretend and extend. At which point …

Brian Villanueva
Brian Villanueva
1 year ago
Reply to  Hugh Bryant

Interesting. I would not have put France in that list.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Hugh Bryant

Germany has done very well out of the Euro system.. without it no other EU country could afford to buy German cars or any German manufactured goods for that matter.. subsidising other EU countries is a small price to pay.

Nicky Samengo-Turner
Nicky Samengo-Turner
1 year ago
Reply to  Liam O'Mahony

The German car industry’s most profitable market by far is the UK, due to our unique leasing and other systems: the OEM car manufacturers can issue bonds to finance, and charge the UK car finance buyer on a profit of ÂŁ3 for every ÂŁ1 financed… so 300% profit: the car actual price/ margin is almost irrelevant! BMW GmbH call UK ” Fairy Godmother”!

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago
Reply to  Liam O'Mahony

Very true, but worse. they must have known that allowing Greece and other similar weaker economies to join would allow their governments the opportunity to borrow using the Euro credit card at levels that would otherwise be unimaginable that mon to be spend on German, and to a lesser extent French, industrial products.

Nicky Samengo-Turner
Nicky Samengo-Turner
1 year ago
Reply to  Liam O'Mahony

The German car industry’s most profitable market by far is the UK, due to our unique leasing and other systems: the OEM car manufacturers can issue bonds to finance, and charge the UK car finance buyer on a profit of ÂŁ3 for every ÂŁ1 financed… so 300% profit: the car actual price/ margin is almost irrelevant! BMW GmbH call UK ” Fairy Godmother”!

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago
Reply to  Liam O'Mahony

Very true, but worse. they must have known that allowing Greece and other similar weaker economies to join would allow their governments the opportunity to borrow using the Euro credit card at levels that would otherwise be unimaginable that mon to be spend on German, and to a lesser extent French, industrial products.

Brian Villanueva
Brian Villanueva
1 year ago
Reply to  Hugh Bryant

Interesting. I would not have put France in that list.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Hugh Bryant

Germany has done very well out of the Euro system.. without it no other EU country could afford to buy German cars or any German manufactured goods for that matter.. subsidising other EU countries is a small price to pay.

Hugh Bryant
Hugh Bryant
1 year ago

The survival of the euro is entirely dependent on the willingness of the Germans to continue to subsidise the French, Italian, Spanish and Greek economies to the detriment of their own.

It seems unlikely that the French, having lived beyond their means and at someone else’s expense (including ours) since the nineteen sixties, will change their behaviour any time soon.

Consequently the hidden imbalances in Europe’s settlement systems will continue to grow for the foreseeable future until it is no longer possible to pretend and extend. At which point …

Brian Villanueva
Brian Villanueva
1 year ago

Considering its backing government is a totalitarian communist dictatorship with a lousy track record of keeping its promises, I have a hard time seeing wealthy individuals, corporations, or governments wanting to hold the bulk of their foreign currency reserves in yuan. Being a reserve currency is more about politics than economics. Short of a unipolar Chinese world (which is highly unlikely due to China’s demographics) the yuan will be a short-term vehicle only.
However, that doesn’t mean those same people aren’t looking fo diversify from the dollar, and to be blunt, the Euro looks pretty good right now. Never thought I would say those words, but it has weathering two major downturns, the near bankruptcy of 3 member states, and a public health emergency. Could the Euro replace the dollar? Maybe.
As far as Britain is concerned, they’re on a long downhill ride to oblivion at this point. https://qph.cf2.quoracdn.net/main-qimg-7572d359298eebabdb76caac486129f7 The pound lost 70% of its value over 50 years, and has never recovered. It likely never will. As this article mentions, England is sucking on the teet of London’s foreign banking system. For the British pound to recover would require England to decide it wants to actually produce something again, and develop an industrial policy to accomplish that goal. Singapore on the Thames is a pipe dream.

Hardee Hodges
Hardee Hodges
1 year ago

Remarkable how a down-vote bot has consumed the comments! Stunning, I might say engineered.

Hardee Hodges
Hardee Hodges
1 year ago

Remarkable how a down-vote bot has consumed the comments! Stunning, I might say engineered.

T Bone
T Bone
1 year ago

Everything is fine.

T Bone
T Bone
1 year ago

Everything is fine.

Josh Allan
Josh Allan
1 year ago

A counter-point to this from George Magnus. I fail to see the Yuan making the inroads it needs to to serve as a reserve currency.

Josh Allan
Josh Allan
1 year ago

A counter-point to this from George Magnus. I fail to see the Yuan making the inroads it needs to to serve as a reserve currency.

j watson
j watson
1 year ago

The CCP strategy, and reaction of likes of Brazil, does assume conflict in the South China doesn’t close off export routes and set off a massive world recession – at which point the Dollar, or Euro perhaps, is much safer option. Brazil is assuming all it’s trade across the Pacific or around the Cape of GH remains unaffected. Problematic assumption if you are dealing with a totalitarian regime and their track records in ensuring long term stability in their regions.
As Article implies and some comments reinforce US has a history of being v hard nosed about Dollar supremacy. Ask JMK and what it took to get post WW2 loans to the UK. So they’ll respond and already are in many ways.
V interested though in how the Euro may emerge from this, and of course the long view on the Euro debate within the UK 20+ years ago referred to this potential squeeze. That boat sailed some time ago of course, but it’s moment like this that leave one pondering the balance of that decision and what it may look like to future economic Historians. Too early to tell for now, but not sure the UK’s more recent track record in big long term strategic decisions inspires great confidence.

Last edited 1 year ago by j watson
j watson
j watson
1 year ago

The CCP strategy, and reaction of likes of Brazil, does assume conflict in the South China doesn’t close off export routes and set off a massive world recession – at which point the Dollar, or Euro perhaps, is much safer option. Brazil is assuming all it’s trade across the Pacific or around the Cape of GH remains unaffected. Problematic assumption if you are dealing with a totalitarian regime and their track records in ensuring long term stability in their regions.
As Article implies and some comments reinforce US has a history of being v hard nosed about Dollar supremacy. Ask JMK and what it took to get post WW2 loans to the UK. So they’ll respond and already are in many ways.
V interested though in how the Euro may emerge from this, and of course the long view on the Euro debate within the UK 20+ years ago referred to this potential squeeze. That boat sailed some time ago of course, but it’s moment like this that leave one pondering the balance of that decision and what it may look like to future economic Historians. Too early to tell for now, but not sure the UK’s more recent track record in big long term strategic decisions inspires great confidence.

Last edited 1 year ago by j watson
Peter B
Peter B
1 year ago

Europe already knows just what partnership with China means. China completely gutted the European telecoms equipment industry which had several world leading players up to the 1990s. The US is far from perfect, but I’d trust them any day over the CCP.
Of course, the EU might still decide that being more independent of the US is worth the greater dependency on China. But they’d be fools to do so. Note that the US is still underwriting European defence.
The author mentions the political and economic motivation for creating the Euro – and then fails to ask the obvious question: why would the EU accept a Yuan-based trading regime when it has the Euro ? Is there something wrong with the Euro he omitted to mention ?
Anyway, we’ve been here before, haven’t we ? US/West vs Comecon throughout the Cold War. No brainer.

P Branagan
P Branagan
1 year ago
Reply to  Peter B

‘To be a enemy of the US can be dangerous, but to be a friend is fatal.’
H. KISSENGER.
Up to the present the UK never fully realised that – but it will learn at enormous cost in the future.

Peter B
Peter B
1 year ago
Reply to  P Branagan

What utter nonsense. We’ve been an ally of the USA for over 100 years. Show me a better ally ? Apart, that is from NZ, Australia and Canada.

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago
Reply to  Peter B

The list of how the US has f*****d over the UK is so long it is difficult to know where to being.
The UK has been an ally to the US but rarely has the US been an ally to the UK. Starting before the end of WWI the objective of the US was to break then supplant the UK as a global power and this continued well after the WW2

Ardath Blauvelt
Ardath Blauvelt
1 year ago

I really don’t want to be nasty, but if the US hadn’t allied itself at enormous cost in blood and treasure, Europe, and particularly the UK’, survival would render your resentment moot.

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago

The US did nothing except out of self interest.
It threw in its lot with the Allies in the First World War because it had lent so much money to the Allies it could not afford them to loose. The US military contribution was negligible and it profited hugely for supplying the Allies.
If I remember correctly America joined the Second World War because they were invited to do so by Japan and Germany declared war on them.
Until this point American corporations had been doing very nicely and out of Germany. And as for lend lease, this is what Keynes had to say “[Morgenthau is] stripping us of our liquid assets to the greatest extent possible before the Lend Lease Bill comes into operation, so as to leave us with the minimum in hand to meet during the rest of the war the numerous obligations which will not be covered by the Lend Lease Bill. . . . [He is] treat[ing] us worse than we have ever ourselves thought it proper to treat the humblest and least responsible Balkan country.”
The victor gets to write the history. Given the lies we have been told of Iraq, Ukraine, Syria how can we assume what we were told about WW2 is true and do we even know the right side won WW2.

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago

The US did nothing except out of self interest.
It threw in its lot with the Allies in the First World War because it had lent so much money to the Allies it could not afford them to loose. The US military contribution was negligible and it profited hugely for supplying the Allies.
If I remember correctly America joined the Second World War because they were invited to do so by Japan and Germany declared war on them.
Until this point American corporations had been doing very nicely and out of Germany. And as for lend lease, this is what Keynes had to say “[Morgenthau is] stripping us of our liquid assets to the greatest extent possible before the Lend Lease Bill comes into operation, so as to leave us with the minimum in hand to meet during the rest of the war the numerous obligations which will not be covered by the Lend Lease Bill. . . . [He is] treat[ing] us worse than we have ever ourselves thought it proper to treat the humblest and least responsible Balkan country.”
The victor gets to write the history. Given the lies we have been told of Iraq, Ukraine, Syria how can we assume what we were told about WW2 is true and do we even know the right side won WW2.

j watson
j watson
1 year ago

US certainly been hard nosed with the UK on occasions, and it’s interests come first.
But how about you go across to Pointe Du Hoc cemetery in Normandy at some point and just have a quiet walk around?

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago
Reply to  j watson

Why should I remotely care about the cemetery at Ponte Du Hoc.
As I have said elsewhere America joined the Second World War because they were invited to do so by Japan and Germany declared war on them.
Also the American contribution in terms of blood and treasure was negligible compared to the price paid by the UK.
In fact for the US WW2 has to be one of the most profitable exercises any country has ever undertaken.
My heart bleeds for the US it really does

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago
Reply to  j watson

Why should I remotely care about the cemetery at Ponte Du Hoc.
As I have said elsewhere America joined the Second World War because they were invited to do so by Japan and Germany declared war on them.
Also the American contribution in terms of blood and treasure was negligible compared to the price paid by the UK.
In fact for the US WW2 has to be one of the most profitable exercises any country has ever undertaken.
My heart bleeds for the US it really does

Ardath Blauvelt
Ardath Blauvelt
1 year ago

I really don’t want to be nasty, but if the US hadn’t allied itself at enormous cost in blood and treasure, Europe, and particularly the UK’, survival would render your resentment moot.

j watson
j watson
1 year ago

US certainly been hard nosed with the UK on occasions, and it’s interests come first.
But how about you go across to Pointe Du Hoc cemetery in Normandy at some point and just have a quiet walk around?

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Peter B

..doesn’t follow it will continue.. on the up fine, but as the US declines it will drop friends that are of no further use, ie as it applies ‘America First’ policies..

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago
Reply to  Peter B

The list of how the US has f*****d over the UK is so long it is difficult to know where to being.
The UK has been an ally to the US but rarely has the US been an ally to the UK. Starting before the end of WWI the objective of the US was to break then supplant the UK as a global power and this continued well after the WW2

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Peter B

..doesn’t follow it will continue.. on the up fine, but as the US declines it will drop friends that are of no further use, ie as it applies ‘America First’ policies..

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  P Branagan

I fear you are correct.. an enemy will be on its guard but a friend lets its guard down and is easily gutted!

j watson
j watson
1 year ago
Reply to  Liam O'Mahony

There was a US ‘America First’ campaign all the way up to 1941. 80 years on…
The isolationist stream in the US not new at all, but when rhetoric meets realpolitik some things appear to have a v strong track record.

j watson
j watson
1 year ago
Reply to  Liam O'Mahony

There was a US ‘America First’ campaign all the way up to 1941. 80 years on…
The isolationist stream in the US not new at all, but when rhetoric meets realpolitik some things appear to have a v strong track record.

j watson
j watson
1 year ago
Reply to  P Branagan

What a load of tosh. Clearly you never got taught even the basic landscape of 20thC history.
US has made foreign policy mistakes, painfully so on a number of key occasions. But it’s also secured the freedom of the western world too. We’d all be either under National Socialist, Communist or some other Totalitarian heirs otherwise.

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago
Reply to  j watson

The list of how the US has f*****d over the UK is so long it is difficult to know where to being. The UK has been an ally to the US but rarely has the US been an ally to the UK. Starting before the end of WWI the objective of the US was to break then supplant the UK as a global power and this continued well after the WW2

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago
Reply to  j watson

The list of how the US has f*****d over the UK is so long it is difficult to know where to being. The UK has been an ally to the US but rarely has the US been an ally to the UK. Starting before the end of WWI the objective of the US was to break then supplant the UK as a global power and this continued well after the WW2

Peter B
Peter B
1 year ago
Reply to  P Branagan

What utter nonsense. We’ve been an ally of the USA for over 100 years. Show me a better ally ? Apart, that is from NZ, Australia and Canada.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  P Branagan

I fear you are correct.. an enemy will be on its guard but a friend lets its guard down and is easily gutted!

j watson
j watson
1 year ago
Reply to  P Branagan

What a load of tosh. Clearly you never got taught even the basic landscape of 20thC history.
US has made foreign policy mistakes, painfully so on a number of key occasions. But it’s also secured the freedom of the western world too. We’d all be either under National Socialist, Communist or some other Totalitarian heirs otherwise.

Hugh Bryant
Hugh Bryant
1 year ago
Reply to  Peter B

The current generation of EU leaders think that history ended in 1989. Europe will continue to flounder until they are replaced by a new generation with a more realistic world view.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Hugh Bryant

…when they extract themselves from under the US jackboot and grow a backbone.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Hugh Bryant

…when they extract themselves from under the US jackboot and grow a backbone.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Peter B

Your opening paragraph suggests it’s better to be invaded than outcompeted.. I’m not convinced. If European electronics couldn’t keep pace they only have themselves to blame.

Peter B
Peter B
1 year ago
Reply to  Liam O'Mahony

I have no idea what you’re talking about. There’s nothing about invasion there.
You clearly haven’t understood what I was saying, but never mind. It’s hardly the first time. And sadly probably not the last. For the record, the European companies were competitive. The Chinese made progress through a combination of IP theft, technology gain through forced joint ventures (Western companies at fault here), state subsidies and dumping.

j watson
j watson
1 year ago
Reply to  Peter B

So right PB.
As we awaken to what the CCP techno-totalitarians have been doing to undermine us it will, and already has, reaffirm the historical importance of our alliance and relationship with the US. Not all marriages are ‘Moon in June’ all the time, but nothing bonds folks like a common, malign and dangerous threat.

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago
Reply to  Peter B

It was not just China. You can also include Taiwan

j watson
j watson
1 year ago
Reply to  Peter B

So right PB.
As we awaken to what the CCP techno-totalitarians have been doing to undermine us it will, and already has, reaffirm the historical importance of our alliance and relationship with the US. Not all marriages are ‘Moon in June’ all the time, but nothing bonds folks like a common, malign and dangerous threat.

Ethniciodo Rodenydo
Ethniciodo Rodenydo
1 year ago
Reply to  Peter B

It was not just China. You can also include Taiwan

Peter B
Peter B
1 year ago
Reply to  Liam O'Mahony

I have no idea what you’re talking about. There’s nothing about invasion there.
You clearly haven’t understood what I was saying, but never mind. It’s hardly the first time. And sadly probably not the last. For the record, the European companies were competitive. The Chinese made progress through a combination of IP theft, technology gain through forced joint ventures (Western companies at fault here), state subsidies and dumping.

P Branagan
P Branagan
1 year ago
Reply to  Peter B

‘To be a enemy of the US can be dangerous, but to be a friend is fatal.’
H. KISSENGER.
Up to the present the UK never fully realised that – but it will learn at enormous cost in the future.

Hugh Bryant
Hugh Bryant
1 year ago
Reply to  Peter B

The current generation of EU leaders think that history ended in 1989. Europe will continue to flounder until they are replaced by a new generation with a more realistic world view.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Peter B

Your opening paragraph suggests it’s better to be invaded than outcompeted.. I’m not convinced. If European electronics couldn’t keep pace they only have themselves to blame.

Peter B
Peter B
1 year ago

Europe already knows just what partnership with China means. China completely gutted the European telecoms equipment industry which had several world leading players up to the 1990s. The US is far from perfect, but I’d trust them any day over the CCP.
Of course, the EU might still decide that being more independent of the US is worth the greater dependency on China. But they’d be fools to do so. Note that the US is still underwriting European defence.
The author mentions the political and economic motivation for creating the Euro – and then fails to ask the obvious question: why would the EU accept a Yuan-based trading regime when it has the Euro ? Is there something wrong with the Euro he omitted to mention ?
Anyway, we’ve been here before, haven’t we ? US/West vs Comecon throughout the Cold War. No brainer.

Simon Blanchard
Simon Blanchard
1 year ago

The US will not allow dedollarisation to gain momentum. They have ways of making life difficult for those who fail to “get with the program”.

UnHerd Reader
UnHerd Reader
1 year ago

They certainly used to,not so much anymore

Simon S
Simon S
1 year ago

Indeed. It could already be argued that as the US no longer even bothers to pretend its debt is anchored to its economic capacity that the dollar is propped up by nothing more than the projection of its overwhelming, debt-fueled military power. But that is how empires crash.

Simon Blanchard
Simon Blanchard
1 year ago
Reply to  Simon S

I agree with you. But it will get messy, especially when compounded with their internal rot.

Simon Blanchard
Simon Blanchard
1 year ago
Reply to  Simon S

I agree with you. But it will get messy, especially when compounded with their internal rot.

Liam O'Mahony
Liam O'Mahony
1 year ago

If you replace the word “have” with “had” I’ll agree with you; but the game is up..

UnHerd Reader
UnHerd Reader
1 year ago

They certainly used to,not so much anymore

Simon S
Simon S
1 year ago

Indeed. It could already be argued that as the US no longer even bothers to pretend its debt is anchored to its economic capacity that the dollar is propped up by nothing more than the projection of its overwhelming, debt-fueled military power. But that is how empires crash.

Liam O'Mahony
Liam O'Mahony
1 year ago

If you replace the word “have” with “had” I’ll agree with you; but the game is up..

Simon Blanchard
Simon Blanchard
1 year ago

The US will not allow dedollarisation to gain momentum. They have ways of making life difficult for those who fail to “get with the program”.

Michael Marron
Michael Marron
1 year ago

If the EU wants to trust their economy to a bunch of totalitarian, self interested and genocidal thugs they are even more stupid and short sighted than anyone thought

Chris Keating
Chris Keating
1 year ago
Reply to  Michael Marron

The problem is that they have already done just that and are looking to China to restore some semblance of normality away from their colonial oppressor across the Atlantic.

P Branagan
P Branagan
1 year ago
Reply to  Michael Marron

When you refer to ‘a bunch of totalitarian self interested thugs’ I presume you’re talking about the Almighty USofA.

j watson
j watson
1 year ago
Reply to  P Branagan

You spent anytime working, writing, voicing opinions etc in China? Gone to a ballot box in China when you are fed up with who’s in charge? Read a critical editorial in any Chinese paper? Sought justice in a CCP court of law? etc etc.
Juvenile comments obviously just make the exponent look, well… juvenile.

j watson
j watson
1 year ago
Reply to  P Branagan

You spent anytime working, writing, voicing opinions etc in China? Gone to a ballot box in China when you are fed up with who’s in charge? Read a critical editorial in any Chinese paper? Sought justice in a CCP court of law? etc etc.
Juvenile comments obviously just make the exponent look, well… juvenile.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Michael Marron

..are you referring to the Chinese or the Americans?

Chris Keating
Chris Keating
1 year ago
Reply to  Michael Marron

The problem is that they have already done just that and are looking to China to restore some semblance of normality away from their colonial oppressor across the Atlantic.

P Branagan
P Branagan
1 year ago
Reply to  Michael Marron

When you refer to ‘a bunch of totalitarian self interested thugs’ I presume you’re talking about the Almighty USofA.

Liam O'Mahony
Liam O'Mahony
1 year ago
Reply to  Michael Marron

..are you referring to the Chinese or the Americans?

Michael Marron
Michael Marron
1 year ago

If the EU wants to trust their economy to a bunch of totalitarian, self interested and genocidal thugs they are even more stupid and short sighted than anyone thought