Let’s make a (bad) international forecast for 2023…

Let's make a bold prediction for 2023. Take it as a game, or as a warning of what could happen in 2023, but based on real facts. In October, Chinese President Xi Jinping successfully completed his report at the 20th CPC congress and was confirmed for the third time as party secretary with a five-year term, as well as chairman of the Central Military Commission.

This achievement elevated Xi to the aggrandizement of Mao Zedong. He is "emperor for life" in China, apparently unassailable. The event also highlighted the CCP's "One China" stance that the unification of Taiwan is "a natural requirement to achieve the rejuvenation of the Chinese nation." Xi and the CCP view Taiwan as Mao's unfinished business.

On Christmas Day, China sent 71 fighter jets and seven ships near Taiwan. Many of these fighters crossed the median line of the Taiwan Strait. The Taiwanese military counted 47 jets that violated the de facto border line.

This show of force was in response to President Biden's signing of the 2023 National Defense Authorization Act, which includes $10 billion in military assistance to Taiwan. A similar reaction erupted in the summer following House Speaker Nancy Pelosi's visit to Taiwan.

At about the same time as Pelosi's visit, simulated war games of a Chinese invasion of Taiwan were conducted at the Center for Strategic and International Studies. The results were bad for both China and the United States.

Certainly, an invasion of Taiwan across the Taiwan Strait by the Chinese People's Liberation Army (PLA) seems like an unlikely event right now, just as it was for Russian tanks to cross the border into Ukraine, too. until moments before that happened.

According to JPMorgan, “while the world is short on raw materials, China is not, as it started hoarding raw materials since 2019 and currently holds 80% of global copper inventories, 70% of corn, the 51% of wheat, 46% of soybeans, 70% of crude oil and over 20% of global aluminum inventories.

Why is China hoarding such massive amounts of raw materials?

At the same time, US sanctions against Russia have had the unintended consequence of forcing China and Russia into strategic cooperation. Throughout the year Russia has sold oil to China in exchange for yuan and one day and the next even Russia continues to reassure the steely solidity of its relationship with Beijing.

In addition, Xi recently met with Crown Prince Mohammed bin Salman and other Gulf Arab leaders in Saudi Arabia. In a direct challenge to the petrodollar, Xi said China would commit to buying oil and gas from Arab countries in yuan. In practice, China is creating a global network for the supply of the raw materials it needs.

It may be a matter of a normal policy of diversification of relationships and the assurance of strategic supplies, or it may be something very different, ie the preparation for a conflict which would have the Pacific Ocean as its heart, a strategic confrontation with the USA and its allies. China is already home to 70% of the world's wheat inventories, and the largest stockpiles of raw materials. It has built its own supply chain detached from Western countries. This can be prudence, or the preparation of a strategy that will allow it to survive for a long time in the event of a conflict, learning from the mistakes made by Russia.

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The article Let's make a (bad) international forecast for 2023… comes from Scenari Economici .

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This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/facciamo-una-brutta-previsione-internazionale-per-il-2023/ on Sat, 31 Dec 2022 16:24:42 +0000.