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Saturday, March 05, 2022

The Biggest Winner – A Free “Case Study” For China To Learn The World’s Response If They Were To Invade Taiwan



The Biggest Winner – A Free “Case Study” For China To Learn The World’s Response If They Were To Invade Taiwan




China is arguably the biggest winner in the current Russia-Ukraine war. And if it’s true that senior Chinese officials told senior Russian officials in early February not to invade Ukraine before the end of the Winter Olympics in Beijing, as claimed by the New York Times (which has been rubbished by Beijing), it means Beijing knew about Moscow’s plan and let it proceed anyway.



Washington reportedly passed the information to the Chinese intelligence in the hope that Beijing would persuade Moscow not to proceed with the invasion. If that’s true, why didn’t China try to convince Russia to abort its plan, but just urged it to delay the invasion? However, if indeed Beijing knew, why didn’t it evacuate its citizens from Ukraine before the war?



If Beijing evacuates its citizens before the invasion, it will only confirm Washington’s theory that Putin had indeed decided to invade Ukraine. The lack of preparation in evacuating its own citizens suggests that either Beijing sucks, or the Chinese government – based on either its own intelligence or the U.S. intelligence or even Putin’s alert, knew but deliberately played Washington.



That explains why U.S. President Joe Biden, obviously shocked with Russian President Vladimir Putin’s sudden recognition of the independence of two self-proclaimed and pro-Russian republics in eastern Ukraine before swiftly sending troops and tanks under the guise of “peacekeepers”, had taken some time to digest and discuss before calling it an invasion.



China had no intention of stopping Russia from launching its military operation, not that President Xi Jinping could persuade Putin in the first place. The conflict in the backyard of NATO countries would provide invaluable information – a case study – of U.S. retaliations and the world’s responses in the event of a Taiwan invasion, or in any future confrontations with the U.S.



Get real, the Russian strongman would not have embarked on his mission against Ukraine, if he didn’t know that he would have Chinese support. It was by design, not coincidence, that China signed a 30-year deal worth an estimated US$117.5 billion to supply 10 billion cubic metres of natural gas per year from Russia during the Winter Olympics – just days before the Ukraine invasion.



On the very day of the invasion, China announced that it will import wheat worth US$7.9 billion annually from Russia, lifting the restrictions on Russian wheat and barley. Russian wheat previously faced export restrictions to China due to plant disease concerns. In essence, China was throwing Russia an economic lifeline after the U.S. and European Union slapped new sanctions on Moscow.



The Russia-Ukraine conflict has shown that the U.S. and NATO are afraid (at least that was the perception) to put troops on the ground to fight Russia, despite the Western countries’ rhetoric to defend democracy at all cost. Even Ukrainian President Volodymyr Zelensky has complained how the U.S. was watching from a distance, leaving Ukrainians alone to defend their own country.



Ukraine is surrounded in the north, east and south, but still has free access to the west, from where Captain America and its NATO allies can send troops, tanks and military hardware. The U.S. and NATO’s unwillingness to engage directly with Russia means Taiwan should stop hallucinating American soldiers will come to its defence if China launches a similar military operation.



If China’s military option is a blockade of the entire island of Taiwan, how does the U.S. plan to send reinforcement? Due to Taiwan’s proximity to the mainland, the Chinese military can certainly overwhelm the U.S. Navy and its allies’ warships with missiles, including “aircraft carrier killer” – DongFeng 26 (DF-26) – also known as the “Guam Express” or “Guam Killer”.



Like Taiwan, Ukraine too has some sort of military agreement with the West. According to the 1994 Budapest Memorandum, the U.S. and Britain have committed to guarantee Ukraine’s independence, sovereignty and territorial integrity. In exchange, Ukraine agreed to give up some 1,900 strategic nuclear warheads, amounted to the world’s third largest nuclear arsenal.



Since Russia’s annexation of Ukraine’s Crimea in 2014, the U.S. has also provided Ukraine with US$3 billion in reform and another US$3 billion in loan guarantees, not to mention military training to Ukrainian troops. Both Ukraine and Taiwan have military assurance and assistance from America. Yet, now Biden has said the U.S. military will not go to war with Russia over Ukraine.



If there is a military conflict in the Taiwan Strait, will the United States, regardless of who is the president, adopt the same strategy? Remember, unlike Ukraine, Taiwan isn’t located in the Europe region. Therefore, while NATO could be spooked of a war because Ukraine is in its backyard, it would be rather hard for NATO to justify its military involvement in a China-Taiwan war.



Russia’s biggest problem is the economic sanctions, as observed by China. However, the Chinese was not afraid of retaliations from the West when Putin and Xi made a joint declaration that both countries’ friendship has “no limits”. That alone speaks volumes about China’s economic power. Unlike Russian’s fragile economy, the Chinese are not particularly concerned about economic sanctions.



Thanks to Donald Trump’s trade war and tech war, China has quietly pushed for self-reliance. This includes not only domestic market to prevent a collapse of its economy, but also key technologies and the payment systems to settle trade transactions. The blocking of Russian banks from using SWIFT financial-messaging system provides an excellent case study for Beijing.



The move to banish big Russian banks from SWIFT has put a limit to Moscow’s use of its US$630 billion war chest. One of the reasons its financial system has been significantly crippled by the sanctions is due to its ancient domestic payment system as compared to China’s system, which has already started digital Yuan in an effort to break the dollar’s dependency.




In 2018 alone, China, the world’s largest mobile payment market, handled a total of 532.814 billion mobile payment transactions worth 445.22 trillion Yuan (US$63.83 trillion). The second largest economy has more than 850 million mobile payment users. The first public pilot digital Yuan (e-CNY) only started in Nov 2020. By the end of 2021, the number of digital Yuan users jumped to 261 million.



Still, Russia had an estimated US$77 billion (13% of total reserves) in Chinese assets as of June 2021. China’s version of SWIFT, Cross-Border Interbank Payment System (CIPS), has signed up Russian banks, allowing both nations to trade and bypass US dollar. Hence, the Russian sanctions will give a boost to China’s payment system for cross-border transaction.



As the world’s second largest economy, it should be relatively easy for China to promote its CIPS as an alternative to settle international claims in Yuan. The sanction indirectly provides free marketing to the Chinese payment system. It’s a wake-up call to other countries, who might now sign up for CIPS. This could further weaken the dollar’s international clout.



U.S. hopes to use SWIFT, CHIPS (Clearing House Interbank Payments System) and dollar to bring Putin to his knees. However, SWIFT is just an international payment “messaging” system, which plays no role in payment execution. Without SWIFT, a country can still rely on telephone, fax machine or even WhatsApp to make payments – if they don’t mind the tedious process.



China’s CIPS and Digital Yuan (or e-CNY), which has been given a good exposure during the Beijing Winter Olympics, are being pushed by the Chinese government and central bank. Economist John Hopkins believes the sanctions on Russia could be counter-productive to the West as cutting Russia off will give rise to alternative systems developed by China and Russia.



The international isolation of Russia, which could happen to China one day, has given Beijing serious notes about not only food security, but also oil reserves which power the economic powerhouse. President Xi is actually more concerned over the economic sanctions imposed by Western countries on Putin and his close associates.



As China prospers, top Chinese officials and their families have bought assets in the United States and other countries over the years. To escalate the pressure, the U.S. and its allies are currently busy confiscating Putin cronies’ assets, ranging from luxury yachts to mansions and even soccer clubs. Such seizure will spook and affect Chinese major political families.



Xi Jinping may be the most powerful man in China. But when faced with personal sanctions, even the Chinese president could be overthrown by corrupt and selfish politicians within the Chinese Communist Party. Having indulged in the lavish lifestyle for decades, the second and third generations of the party’s founders may find it hard to live without expensive toys and luxury holidays.



If Xi Jinping could rally the 1.4 billion populations, an internal rebellion might not happen. Considering that not even Switzerland stays neutral, perhaps it’s time for all the Chinese’s ruling elite to move or diversify their offshore wealth to somewhere else to escape sanctions, such as to Maldives or UAE, who has abstained from a U.S.-led resolution to condemn Russia.



If the online opinion in China is any indicator, where most of the people are throwing their support behind Putin and Russia, President Xi has one thing less to worry – backlash from the Chinese people in case of a war with Taiwan. However, China cannot take Taiwan by using Russia’s justification – the Ukrainian has committed genocide on Russian-speaking people.



People of China and Taiwan are Chinese-speaking people so Beijing can’t invade under the pretext of genocide. The war will start when the Taiwanese government recklessly declares independence, hence challenging and provoking Beijing. But even if a war begins in the South China Sea, the U.S. and European Union may think twice about imposing economic sanctions on China.



An economic sanction against China could trigger a global economic meltdown. There’s a reason why Trump had only unleashed trade war, instead of economic sanctions – the nuclear option – to bring China down to its knees. Even then, the trade war has failed spectacularly. Nevertheless, the Chinese people are pragmatic. They will not openly challenge the U.S. sanctions.



It would make more sense for China to pretend that it is complying with the U.S. and Europe sanctions, but continue to support Russia behind the scene. After all, as long as China and Russia trade using their own payment systems, the Western countries will never know. China’s priority is to make money, not to brag how they cleverly and easily evade the American sanctions.



More importantly, China has observed that the military and economic superpower United States actually is incapable of fighting two concurrent wars at the same time. Biden has shifted all his attention to Ukraine, giving some breathing space to China. Both Beijing and Moscow are slowly deploying their respective economic and military chess pieces to test the U.S.’ limits and next moves.





2 comments:

  1. Of course a China invasion of Taiwan will receive overwhelming overwhelming support from its population, until they 100,000 , 200,000 only-sons will never be seen alive again, many without even their cadavers being recovered , as Taiwans 1,000 Harpoon antiship missiles are perfectly capable of turning China's troop landing vehicles into burning wrecks... a real-life Ham Kar Chan.

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  2. "Taiwans 1,000 Harpoon antiship missiles are perfectly capable of turning China's troop landing vehicles into burning wrecks"

    Wakakakaka…

    Why don't u mention the Tien Kung (天弓) surface-to-air anti-ballistic missile & anti-aircraft defense systems developed by Taiwan?

    Don't forget too those US soon-to-be-decommissioned weaponry that Taiwan has bought on astronomical cost.

    Ooop… also the morale & physiques of those glasshouse-ed strawberry soldier boys!

    Wakakakaka… perhaps u NEVER read ANYTHING about them mishaps with these 'taiwan' weapons & soldiers!

    China will not kill Taiwanese bcoz Taiwanese r Chinese!

    It would truly an impossible task for those 台毒 dickheads & mfer like u to understand.

    U people SHOULD stand up to yr big WORDS & defense Taiwan if the unification war starts. Then u can forget about those Harpoon antiship missiles u so dependent on. Bcoz, with banana-ised mfers fighting for Taiwan at the front line, just a volley of 喀秋莎BM-13火箭炮,across the Taiwan strait from Fujian coast, would sent all of u truly to Ham Kar Chan!

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