China’s BRI: Reshaping the Global Economic Order? Conversation w/Dr. Da-Hsuan Feng & Dr. Yan Liang

All right, hello everybody and welcome to Geopolitical Trends, where truth matters. Very excited to be with you on this August 3rd. I know it's the weekend, everybody's relaxing, but I am very grateful to you guys for, uh, being here, but also because of my guests. So today you are in for a treat, and I mean it when I say this. You guys know I don't sugarcoat things here, so So I have two wonderful guests that you're going to be learning a lot from. So let me just go ahead, bring them onto the studio here, and we're going to get into it right away. So let me get everybody here. Here they are. Hello, Dr. DaShan Fang.

Hello. Hello.

Hello, Dr. Yang.

Hello, Dr. O. Good to see you again.

Good to see you too. You're all familiar guys. You've, you've seen Dr. Yang before. And, uh, on this one here, we're gonna be now dealing into some very, very interesting topic. Then this one has to do with the PRI. So before I'll do all this, let me do a brief intro. Then, by the way, guys, I put the full bio for both my guests in the description along with the links and everything. I highly recommend later on you go and check her out. So let me check— let me start with Dr. Yan. Liang, bio first. Uh, Dr. Yan Liang is a Peter C. and Bonnie S. Kramer Chair Professor of Economics at William Mary University. She is also a research associate at the Levy Economics Institute and a researcher— or research scholar, rather— of the Global Institute for Sustainable Prosperity. Dr. Yan specializes in MMT Modern Monetary Theory, Economic Development, International Economics, and the Political Economy of China. So she has published in various leading journals and contributed to or co-authored several other books. Regarding Dr. Dashan Feng, let me— I'm gonna do each one of you. I got a picture of each, so I'd like to share them if you guys allow me to do that. Here is Dr. Da Shan Feng. Here, uh, Dr. Da Shan Feng, he's a friend of mine, by the way, and he lives close to me, about 15-minute drive. So Dr. Da Shan Feng, who was, uh, who is, uh, currently the chair— chairman, that is— of the International Advisory Board and honorary dean of the Belt and Road Research Institute in Hainan University. He's also the chief advisor of China Silk Eye Valley Research Institute, in addition to being the academic advisor for Center for China Globalization, is known as CCG. Uh, Dr. Da Shanfang completed his Bachelor of Arts from Drew University and received his PhD in theoretical physics from the University of Minnesota. Dr. Feng is a fellow of the American Physical Society and the honorary adjunct professor of 15 Chinese universities, which included Peking Union Medical College, Fudan University, the Hangzhou University of Science, and Chinese Academy of Science Institute of Applied Physics, among others. He is the author of many books, including his latest one, and I do have a picture of his latest book right here just to share it with you guys. And it's— that's called The China Millennium Transformation: The Belt and Road Initiative. So, well, welcome all, both of you here. Very excited to have you. So let's, let's get into our conversation here by starting with the first question. And the first question I'd like to ask you guys is, I would like to have your perspective, each one of you, about the global economic order that we are in today. How do you see it? Let's start with you, Dr. Yang.

Yeah, so I think that's a great question. I think how I would categorize the current world is that we're in this transition, right? We're transitioning from the sort of, um, the very sort of a US dominate economic world, right, along with the G7, to now a world that is much more multipolar. When it comes to, for example, economic weight, we're seeing the rise of Global South. We're seeing, you know, countries like BRICS and expanded BRICS are now basically an economic counterweight to the G7. So we're also seeing, you know, changes in terms of economic models, right, that it's not just represented by economic sizes of the, you know, different countries, but also read a different way of doing economics, of growing their countries, and also in terms of international governance. So I think, again, we're seeing the G7 in many senses is declining, both in their economic size but also in their influences, and also with their very, I would say, outdated, neoliberal kinds of ways of governing their own economies and also the global affairs. I think This is how I would describe that we have this transition, especially I think after the COVID we're seeing sort of countries recover and recuperate from this big disruption. But again, I see that in the leadership of China and also other Global South countries, I think there is really the desire and the drive to really develop a new sort of global economic landscape, a very different kind of relationships between countries, right? Instead of my way or no way, I think countries are now really looking for peace, sustainable development, and trying to really find ways to tackle with all these global challenges, right? Climate change, for example. In the same time, I think we are seeing a lot of uncertainties and also disruptions. And that typically is the case when we are having economic transitions, the sort of idea that the old world's dying, the new way is being reborn, is being born. So we're in this times of uncertainties and volatility. So we're seeing regional conflicts, we're seeing geopolitical tensions, especially from the United States. So I think this is the reality that we're in, which is full of new opportunities and potentials, but also a lot of difficulties and challenges. So, um, I think that would, that would, that would be my take on this.

Very, very interesting. Uh, uh, Dr. Dashan, uh, how do you see the global economic order today?

Yan, as an expert in economy, has, uh, given a complete, complete description of the current situation. I'm not an economist, so I could only give you a sense as a single human being living in this world with Asia as my background to look at this. Recently, the new Prime Minister of Singapore, Lawrence Wong, said something very interesting when he came to visit Washington, D.C. He was challenged, or he was asked a question which sounds like a challenge, is how does Singapore handle the world where there are two major powers? He said it very succinctly. He said, "A, Singapore is good friends with the United States, have always been. China, of course, now is a good friend of Singapore. So he made an interesting comment, a twist in the English language. He said that, "I think we can have more than one best friends." That sort of sums it up. About the multipolar world, that countries in the Global South, and Singapore is certainly, even though Singapore is doing very well economically, I think Dr. Yan probably knows far more than I do, although I grew up there. Singapore has to be very, very careful in balancing these two major powers in the world. It's quite different from the days where US and the Soviet Union were competing. Because Soviet Union, unlike China, had no business deals outside. In fact, not even business deal inside, but China is totally different. Between 2000 and today, China went from having only a few countries as its major trading partner to something like 170 or 180 countries. As its major trading partner. So the bipolar world is no longer just military and economic, but is heavily dominated by the economic, by the trading part. And Singapore looked at it this way and asked itself very succinctly, well, how do I navigate in this troubled water? And they say it very clearly, we will do our best to be the best friends of both.

Very, very, very interesting concept here. The idea of what I wanted to address is how do we see, how do we see, for example, the The South, you mentioned the Global South, uh, uh, Dr. Daschan, but the idea of BRICS, where BRICS fits in with this big picture, do you see any involvements regarding BRICS in this aspect? Before we get into the debt trap about the BRI and so forth, just within these changes of the global economic you mentioned, do you see a role for BRICS into pushing into this direction?

Well, I think, well, I'm again, I think Dr. Yan is an expert in this. Let me just, since you asked me, I will say a few words. Yeah. As a non-expert on this issue, I think the most important part about BRICS from a non-expert is that we begin to see the number of countries wanting to join it. For example, countries like Malaysia has already expressed deep interest in becoming a part of BRICS.

Why?

Why is that good for Malaysia? Why is that good for Thailand, for example, who also expressed great interest in joining? I think it's because they begin to see that not only the world is dominated by printing of American dollars, but the new dollar, the new currency could be forthcoming, and they don't want to be left behind. At least, at least that's my non-expert way of looking at it. So from a business point of view, these new leaders in these countries, Global South countries, by the way, They are just as smart as you can get. They know how to deal with the real world. Should never underestimate their intelligence. Sometimes I think the West tends to do that. They just think of these people not very sophisticated. Let me assure you, Malaysia leaders are just as sophisticated, maybe even more so than some of the American leaders, and they understand which side of the butter is on, on the bread.

Interesting. Uh, Dr. Yang, from your perspective, an economic one that is, where do you see the role of BRICS with the expansion that is in conjunction to the BRI?

Yeah, that's a very interesting question. So I think, you know, Both of these and many other initiatives are really under this whole global development initiatives that China is promoting. And I think, again, from China's perspective, what is important is that we wanted to find ways to maintain sort of peace, right? Global peace. And I know that the US probably has a sort of Cold War mentality with China, but I don't think China is interested in any ways to get in those kinds of cold wars. So going back to this idea that we are friends, right, that we don't necessarily have to have this confrontational, uh, attitudes and acts towards each other. So I think, you know, this is a way for China that it sees peace as being very important, it sees sustainable development as being very important. And so that is what really, I think, the guiding principle when you look at all these different initiatives that China is adopting. So I would say these two are different, right? BRI, as you know, now includes, you know, 12 countries and account about 30% of the global GDP by the PPP standards. And also it includes various kinds of countries that are either geopolitically important, or they have large and rising and growing population, or they're in very specific areas around the world, or they have, you know, very different economic and political systems. But nonetheless, I think what put all these people, put all these countries together, it's not just a resentment against the G7 or the developed world, but more importantly is to seek a way to grow together, right, to achieve that sustainable development, peaceful, right, kinds of, kinds of world. So I think that is the reason why these countries are interested in to form regional groups, to have trade, to have investment, to have sustainable growth, to have technological innovations, to have, you know, new ways of regional trade and finance and digital payments. And I think that really characterized the BRI. And by the way, I also just wanted to hammer home this idea that, you know, this is not sort of a bloc kinds of cementation, right, or confrontation. Because, you know, look at Italy, right? 2019, they joined BRI, then they quit, right? But now they're coming back. Meloni just visited China for 5 days, and they signed many deals, and they wanted to restart. Oh, great, you're all in preparation with all the wonderful pictures. So yeah, you totally did your homework. So I would say, you know, again, you know, both are different ways of achieving this common goal. But of course, BRI has been, you know, a lot more, I would say, China-centered as a way, at least at the very beginning, right? When Xi Jinping brought this up in 2013, it has to do with China going out to invest. You know, to this day, more than $1 trillion of finance going to, you know, 150 countries as partner of the BRI. Well, not exactly 150 150 countries all receive investments. But, you know, those are the countries that sign on to the BRI initiative. And, you know, about 70-ish, 80 countries actually get the Chinese finance or construction or investment and so on and so forth. Um, so I think, you know, both bring tangible, uh, um, tangible, um, you know, uh, benefits and win-win kind of benefits to China as well, right? It's not deniable China does have their own economic interest in all these initiatives. But the point here is that You know, it's, it's China partnering with all these countries instead of, you know, either seeing these countries as victims, as somebody needs help, right? A lot of times the West is saying, you know, we're gonna help, help these countries, right, and help them to do their reforms or help them to, you know, put their act together. China does not see it that way. It sees a win-win, mutual beneficial cooperation. So that's the way I would sort of again characterize all these different initiatives. Some of them involved more investments from China's part, others are more cooperative in building regional payment systems and so on and so forth. So there are some differences in terms of the exact practices.

Yeah. Just to go back—

Allow me to add a little bit to what has been said.

Sure.

If it's okay. Of course. The BRI was initiated by Xi Jinping, or at least in two speeches he made in 2013. And the BRI could, if you think about what BRI wants to do, is to take China people's viewpoint of the world outside. You know, the name China in Chinese, which is Zhōngguó, means center country. Chinese have a tendency of looking inwards, and because for thousands of years it's one of the most powerful nations in the world, Chinese tend to look inward. In fact, It's very interesting. During the Han Dynasty, there is a very famous person, Ko Chang-chien, who was sent by the emperor to go to Central Asia. Why? Because they want to look at what the outside world looks like. Now, if you think about Han Dynasty, it's already several thousand years after China was developed, and he was the first one to be opening his eyes to look at the outside world. I mean, there are so many things like this. For example, the Silk Road, uh, about in the Song Dynasty, there's a well-known large Jewish community in Kaifeng, China, right in the heart of China. And, uh, where did it come from? Well, they came from the West. The way west of the Silk Road. And if the Silk Road is a two-way street, then there should be as many Chinese at the other end as there are Jews in China, but there are no Chinese outside because the Chinese look inward. So the BRI is a very, very important initiative initiated by Xi Jinping and his group in asking China now, with the world changing as quickly as it is, or it was, we need to truly understand the outside world. By truly understanding the outside world, we have to go out. We cannot just look inwards. And that is the fundamental principle of BRI, And once you start looking outside, what does that mean by looking outside? It means looking outside culture, looking outside history, looking outside food, even other people's food, and so on. For example, India is China's neighbor. It has a huge population, and the number of universities in China that actually studies the Indian culture and Indian history, you can count with your fingers. And clearly that is a problem, because while India may have lots of problems, not understanding India is certainly not one that China should have. As a country moving into the 21st century, looking at the world as it is. I have to admit, in the last 10 years since the Belt and Road Initiative, China has changed enormously in this point of view. For example, when it first went to Malaysia in the beginning, it only brought Chinese workers in. It even bring in Chinese rice because the Chinese workers would not eat the rice of the local Malaysians. Everything has to be Chinese, Chinese-centric. And in the last 10 years, that has changed. So I think that BRI not only is an economic or technological development, it's a development of the Chinese mindset, changing the Chinese mindset, which is, as you know, is going to be or has been far more complicated and far more difficult than changing technologies.

Yeah, and let alone for us, we have no idea about the Chinese history to even understand where it started. That's, that's one of the weaknesses in the West. So very, very interesting, uh, part, Dr. Dashan. Appreciate you sharing this. I want to go back to your point, Dr. Yang, regarding how many countries been in, uh, uh, as far as the BRI And I did that, of course I had to do my own research and dig into the information. I know where to get that. What I found is that, that about 32, besides the 155 countries, 32 international institutions were involved. I was aware of one particular case in North Morocco in Tangier, but the Moroccan government pulled out of that. So, well, here is what I found about 38 countries in sub-Saharan Africa. 34 countries in Europe and Central Asia, 25 countries in East Asia and the Pacific, 17 countries in the Middle East or West Asia, that is, and North Africa, pardon me, and 18 countries in Latin America and the Caribbean. So I found it very, very interesting. Just wanted to add, uh, uh, to your previous, uh, uh, uh, conversation on this one here. So I want to shift our conversation, and I'll start with you, Dr. Yan, about the narrative, the concept that we've been hearing in the West, which is nothing new, is that, uh, uh, the BRI is considered to be that trap. When we consider what the IMF is doing, or the World Bank, where do you— why is this narrative has been persisting even though it's not holding anymore? Why do you think was this push from the West into categorizing the BRI as a debt trap?

Right, I think, you know, this is an excellent question. Um, so first of all, the debt trap diplomacy, right, was a term that was brought up by an Indian scholar. And I think what would be very interesting is, um, you could put this, uh, you know, let's think about, let's maybe look at some of the African countries, their own scholar, the way they would characterize these kinds of claims. Right. What they're saying is that this idea of debt trap was not originated out of the concerns of these African recipient countries of the BRI finance. It was actually propagated and adopted and really widespread by the Western countries out of the discourse quietness of, you know, China's challenge to Euro-American dominance in, you know, the Global South. And so I think that really speaks a lot. Before we really, you know, get into the facts, right, we wanted to first talk about the motives. What is behind this? I think it's propaganda, right, to badmouth China's, you know, BRI initiative. And at the same time, I think it's It's incredibly arrogant, basically saying all these other countries are on the partnership side of these countries, they have no idea how they are screwed, right? So they're really taking all these agencies from these countries again, thinking them as a foolish victim of China's predatory behavior, which is completely, you know, again, it has been debunked. By credible research institutions and researchers. So I think from an economic point of view, I think, you know, other than really understand the true motives behind this debt trap diplomacy, we also want to look at the facts. The fact number one is that a lot of developing countries do have the so-called, you know, financing gap. According to the United Nations, the UNCTAD, the developing countries, especially when you think about low-income countries around the world, the global South, would need somewhere around $2.6 trillion a year investment from now to 2030 to achieve their Sustainable Development Goals, the SDGs. $2.6 trillion with a T. So there's a tremendous amount of gap. That needs to be financed for the infrastructure, be it roads, you know, ports, or when it comes to, you know, power generations and industrial parks and so on and so forth. So there is an acute financing need, and this money is not coming anywhere from the developed West, right? They have very minimum, as a matter of fact, right, to provide to the developing world, and we can look at some specific numbers, right? The $100 million pledge for the climate funds and nowhere to deliver that since 2019. So this is the first thing to start with. And second is, again, that the debt trap, the meaning of this means that China purposefully, right, use these unaffordable financing, you know, to put these developing countries in trap, then seize their strategic assets, right? This is what the debt trap means. But the matter of fact is that a lot of these, uh, projects, investment finance projects, were initiated from the developing countries, right? The most famous example is the, you know, the Sri Lankan's, um, Hambantota Port. That was always used as an example to accuse China of, you know, that trap. But the matter of fact is that is Sri Lankan government started— they initiated this project. They actually did the feasible studies with a Canadian international development agency. So it's the Canadians that said, okay, this project is feasible, go for it, right? Then the— sorry, the Sri Lankan government went to the United States and they went to India and trying to find financing, and both of those countries said no, right? And so China then became the candidate to provide the financing. And also the China Harbor Company become the constructor of the main contract— contractor for this port project. So anyway, and I think, you know, this deep— that this— that Trump sort of narrative again deprive all these developing countries of any of their own agencies and really say, you know, this is coming from China. China somehow magically are able to just, you know, force these countries to take a loan. And that is completely nonsense. So I would say, you know, really from an economic point of view. And last but not least, I think we can talk about this later, right, to see some of the really tangible benefits these BRI projects have produced for the various countries is tremendously important to allow, you know, some of these developing countries to build connectivity, to build their power generation capacities, to be able to get certain industrial, you know, parks and and embark on that structural transformation and so on and so forth. So there are really tangible benefits. But of course, some countries are under debt distress. That's undeniable. But we again need to see the actual reason behind that instead of saying, well, because China is a big lender and therefore, you know, it is responsible for all the unsustainable debt. As a matter of fact, going back to the gentle, gentle poor as example, You know, back in 2017 when, you know, Sri Lanka started to have the debt problems, they're paying, you know, billions of dollars debt service. The project that, you know, the project actually only accounts for about 5% of the total external debt payments of Sri Lanka. So it's not, you know, trying to put up this mega project and bankrupt the entire country. As a matter of fact, that is a very small proportion, you know, of the external debt of Sri Lanka. But I think, you know, there are lessons lessons to be learned. And I think that is exactly what China is doing right now, to think about the second phase, second stage of BRI, to consider more carrying capacity of these countries and to think about what are the ways to leverage small amount of investment or, or finance to generate even broader impacts and, and benefits. So we can definitely talk about, you know, some of the, the changes of the BRI, um, as As I think it's important to understand how things have changed. But again, in terms of that trap, it has been debunked by many scholars from Johns Hopkins University. You know, Bao Ting Gan, I think she has very influential pieces in The Atlantic to debunk that trap idea. Boston University has put out a lot of stats using facts and figures, again, to debunk this idea of that trap. And final point that I would make is There's really very few cases, even none case, even in the Hambantota case that China so-called seized the strategic assets. The matter of fact is that China has been involved in 70 different type of debt restructuring programs. And, you know, China's point is to help these countries to be able to generate operating revenues over the long term to repay debt instead of going into to seize, you know, these assets, because that is not in the interest of China at all. It does not make any economic interest in terms of, you know, of doing that. It's very costly, right, to operate and seize sort of the assets from other countries, and that is against the commercial interests of all these Chinese SOEs and development banks. So I'll stop here and, you know, feel free to come back to some of the points if you want to.

No, very, very interesting, especially about the debunking thing, because I am about to share with you, uh, some PowerPoint from Dr. Da Shan Fang. I'm going to share it in the screen. I will talk about this one, but before I'll do this, I want just to add, uh, uh, to what you said regarding Sri Lanka and Argentina. So in my opinion, those two cases, even though during my time in Washington, DC, I was aware of what's going on in Sri Lanka with the sort of the loans that we provided through JP Morgan, and it was another alternative one through BlackRock at that time was going through the back door of the government. So I, I, I see your point, Dr. Yang, uh, regarding the tangibles you mentioned. I'll share again another example as one who traveled to Africa when I was still in Washington. You land in an airport, okay, you drive on a highway. Well, that airport and that highway was built by the Chinese. And yes, when you have the Secretary of State or the Secretary of Treasury complaining to those, uh, countries about Well, you need to cut off your ties to the Chinese economically. It's like, well, wait a minute, that road you drove on, you didn't build it, that was the Chinese that built it. So on a kind of like CEO point regarding the tangible, the last thing I want to share with you is an example that I was made aware of regarding Morocco, uh, someone from inside the Royal Palace. I got the word that the, or the conversation was between between the Chinese and the Moroccan government regarding the city of Tangier, which is up north, right across the Mediterranean, near Gibraltar. And the Chinese offered to develop that city as far as the infrastructure, the ports and everything, but in something in return. Chinese not going to do it for free. It's common sense. And the Moroccan government, the king had to make that decision by saying No, we are not interested in this anymore. And I do believe that. I don't think so. The Moroccan government just willy-nilly left the project. It was pressured by the United States. Knowing what I know, I am 100% that's what happened. But my point in this is that Chinese didn't pressure Morocco into the project. They said, okay, thank you, shook hands and say good luck. Only recently which was about 4 months ago, Moroccan government reached out to China as far as cultural exchange. And the reason being is because Morocco gets concerned after seeing what China— what, I'm sorry, what Algeria and Tunisia and Egypt did with China and all this part of the BRI. I just wanted to share this quickly here. Let me share the screen, uh, with you all guys, because I'm gonna turn it over to Dr. Da Shan Fan, who's gonna talk to us about some PowerPoints here, which you will find very interesting. And this goes in line with what Dr. Yan Liang just explained. So here is the screen right here. Let me expand on it. I'm gonna make it bigger here. So, all right, take it over, Dr. Da Shan.

Okay, well, uh, I think Dr. Yan gave a, uh, complete understanding of the misunderstanding of debt trap. It's actually a terminology that now the Western world sometimes is used to describe the Belt and Road Initiative. Next slide. Next slide. Okay. Yeah, I thought that it would be useful, and Dr. Yan sort of mentioned it already, but I want to zero in on, because the research carried out on the issue of debt trap were done by highly outstanding American intellects. These are not people had any reason to do propaganda. And this is an article known as The article is known as "The Chinese Debt Trap is a Myth." So you can see already the title of the article is— there's no minced words here. The two people that have done this work, and I think unfortunately you never hear that the U.S. government mentioned them, they're outstanding intellects. One from Johns Hopkins University, Deborah Brautigan. I became her absolute fan in the last 5 years. And the other one is, is her collaborator Meg Rittmeyer from the Harvard Business School. And this was published on 6th of February 2021, 3 years ago in The Atlantic. Next slide. And I think— no, go back the slide before. Yeah, right here. I think Dr. Yan mentioned about Hambantota Port, which is at the corner of the southern end of this island called Sri Lanka, or in the old days when I was in Singapore, we call it Selangor. Next slide. Now, the standard Western narrative, and sometimes it's still being used, is that Beijing lent money, as Dr. Yan said, and Sri Lanka has no prospect of paying back. So they're trapped. That's as simple as that. Now, looking at this way, now whenever these words are in italics, means that I'm quoting from the paper. It says, seen this way, the Chinese internalization as laid out in our— in the program such as the Belt and Road Initiative is not simply a pursuit of geopolitical influence, but also in some tellings a weapon. They'll weaponize it. Once a country is weighed down by Chinese loans, like a hapless gambler who borrows money from the mafia. These are her, their words. It is Beijing's puppet and in danger of losing a limb. Next slide. In fact, the first person who actually used debt trap, although debt trap concept is there, but he actually used debt trap to describe what the BRI was Mike Pence, who was at that time the vice president of Trump. In fact, the Chinese banks— it's very interesting, these are their words again— in fact, Chinese banks are willing to restructure the terms of existing loans and have never actually seized any asset from any country. Now, the Chinese government spent considerable effort in understanding how Sri Lanka understands its profound economic development needs. Using this as the understanding, China in all its BRI projects created win-win scenarios, as mentioned by Dr. Yan in Africa, for example. Now, here's a very important comment they made. Sri Lanka government and even while it was still war-torn at the moment, approached the United States and India, and she mentioned this already. Both countries said no, but a Chinese construction firm, China's Harbour Group, had learned about Colombo's plan, hopes, and lobbied hard for the project. China's Exim Bank agreed to fund it, and China Harbour won the contract. Our research, our meaning their research, shows that the Chinese banks are willing to restructure the terms of existing loans and have never actually seized an asset from any country, much less the Port of Hambantota. One should not assume Sri Lanka government was is ignorant about economy. Soon it realizes that it is not easy for the port to be profitable initially. So it immediately requested China to be a co-sponsor of the project. They say, hey, let's work together. You know, let's— if you make money, let's make money together. Here's another very important comment in the article. The notion of debt trap diplomacy casts China as a conniving creditor and countries such as Sri Lanka as its credulous victims. On a closer look, however, the situation is far more complex. China's march outward, like its domestic development, is probing and experimenting, a learning process marked by frequent adjustment. After that construction of the port in Hambodato, for example, Chinese firms and banks learned that strongmen saw and that they are better have strategies for dealing with political risk. So, you know, there are all these problems that look obvious now, the Chinese have to learn, and they learn very, very quickly.

Quickly.

Now, the other side of the debt trap myth involves debt trap, a debt trap countries, and she mentioned, or Dr. Lin mentioned already, places such as Sri Lanka, or for that matter, Kenya, Zambia, Malaysia are no strangers to political gains. They are irked by American views that they have been so easily swindled. As one Malaysian politician remarked to us, meaning the authors, speaking on condition of anonymity, to discuss how Chinese finance featured in the country's political drama, "Kan the US State Department tell the difference between campaign rhetoric that our opponents are slaves to China and actually being slaves to China? I mean, if you look at how pinpoint that these authors have done, the events that led to a Chinese company's acquisition of a majority stake in the Sri Lanka port reveal a great deal about how our world The world is changing. China and other countries are becoming far more sophisticated in bargaining with one another, and it would be a shame if the US fails to learn alongside them. Michael Ondaatje, who is one of Sri Lanka's greatest chroniclers, once said, In Sri Lanka, a well-told lie is worth a thousand words. And the debt trap narrative is just that, a lie and a powerful one. If indeed the Western version of BRI or Build Back Better World, B3W, can ever become a reality, I think there is much the West can make an effort along the way to study how China spent the past 10 years carrying out this historical project. Indeed, China made some initial blunders, but rapidly learned to mitigate them as time goes on. Now, clearly, if you at this moment in time, If the United States, which is still the most powerful nation in the world, and China is rapidly becoming number 2, if not number 1 soon, if these two countries could actually come together and work together as partners, it can only help humanity.

Indeed.

We need to start thinking about humanity now, not individual countries, because the world is in trouble. The world is in trouble in many, many dimensions. Our global climate issues and so on, these are all global issues, and only if these two countries can work together, that can give some hope to humanity.

Well, spot on, spot on, Dr. Da Shan. Truly appreciate you sharing this short presentation here. By the way, guys, just prepare your questions for later on. And to those who might be just joining us now, we are having a conversation with Dr. Yan Liang and Dr. Da Shan Fang. So, Dr. Yan, I want to turn it over to you here, please. I need to ask you one specific the question regarding what lies ahead economically and financially. And my reference here is to two main events that's going to be happening next year. The first one is the BRICS summit in Kazakhstan in October 2024. At the same time, it will be— Malaysia will be hosting the chairmanship of the ASEAN in Malaysia. So now If you take those two and you take the BRI on the other hand, and you take of course the changes to the global order financially speaking, given how many are de-dollarizing, where do you see it going? And would you suspect that many more Asian nations will join in both BRICS and the BRI? For those who have not done so yet?

Yeah, I think these are really great questions, and there's a lot to unpack. So I think, first of all, in terms of the BRICS expansion, even though I think this year we have not really seen very concrete expansion, but like what Dr. Feng has talked about, there are many countries have expressed their interest of joining. So Nigeria from Africa, and Malaysia, Thailand, from Asia. So many countries are expressing the interest again because they see the tangible benefits of having, you know, the partnership with China and many other, you know, countries in the same sort of, in the same initiative. In terms of RMB and in terms of sort of de-dollarization, I think again there is a genuine interest to have multiple currency countries, especially when it comes to regional trade, to have the local currency in both in terms of trading currencies, but also in terms of investment and other vehicle currencies. I think that is very important because it makes a lot of economic sense. When you have only one currency that dominates the world, what you have is both the very much of instability with the currency, right? If the currency falls, the value, then then, you know, your reserves will lose value. If the country decides to cut you out of their finance, their payment system, then you are not able to, you know, make the payments and, and, uh, make the transactions. So there are a lot of economic interests and, um, I think geopolitical interest to diversify, you know, the uses of currency. And I think, again, the United States, even though the US dollar has been the reserve currency, has been the vehicle currency, the United States has not been a good stewardship of that global financial order. And we know from the financial crisis, and we also know, you know, the US is behind many of these developing countries' debt default episodes. So, so I do see that there's a genuine drive to do that. And I think China has making headways in promoting the RMB uses. First of all, we know that for China's cross-border payments, now over half now is is denominated in the Chinese yuan. Right now, the dollar's role has diminished to about 30% when it comes to China's own cross-border transactions. And China also has been diversifying its reserves away from the dollar. So now, you know, the Chinese holding of the Treasuries has been going down since the mid-2010s, and now it's about $800-700 billion. So I think that is on the part of China doing its own, you know, sort of building all these infrastructure, right, to allow for the use of RMB. Now, outside of China, again, China is doing many different kinds of initiatives to promote the use of RMB and also, by the way, promote the use of other currencies. Because we know, for example, China is one of the leading countries in the New Development Bank, the so-called BRICS Bank. And one of the goals of the bank is to increase local currency lending to 30% in their portfolio in the next few years. So in other words, I think we need to be careful here not to equalize de-dollarization with, you know, promoting only the Chinese yuan as a dominant currency. That is not in the interest of China, and I don't think this is in the interest of the Global South countries anyways, right? Why? What's the point of replacing one dominant currency with another.

Yes, true.

Exactly, right. So the point here is to promote the multi-currency, multi-polar currency world and having countries to be able to utilize their own currencies as much as they can. And so I know that you have questions for me later on about MMT. I think this is one insight in terms of the currency hierarchy, in terms of the danger, the risks of using other countries' currencies, right, for these transactions. So I think, you know, that's the reason I think behind why China and many other countries are trying to promote, you know, alternative currency uses. So that's what I would say. Now, in terms of other initiatives, so BRI, in terms of the changes, so again, some of the arguments that I have seen is that China's trade, right, in terms of its trade surplus has been dwindling. This is seen from the pandemic years and so on and so forth to say that China can no longer afford sending so much dollars abroad. So that's why they're reducing some of their lendings abroad. And there's other comments about other reasons for why China is no longer interested in the mega projects. But I think there's some misunderstanding and misreading of China's intentions here. So I think, first of all, we know that China's trade is still gaining a lot of momentum. China is still accumulating a lot of trade surplus. There are pros and cons about that. I'm not going to go too much into it. But just to know that, for example, in June, China has close to $1 trillion in one month trade surplus. So it's not that China is running out of dollars. To support its overseas finance. But I think China does, as Professor Feng talked about, has made conscious changes in the lending practices. For one, it's because the recipient countries do have certain limits in terms of how much they can continue to borrow and service the debt. And second is China now is a lot more savvy after 10 years of trial and error understanding feasibility project studies and so on and so forth. So I think China will be more careful in terms of the mega projects. And in turn, they are going to promote more the so-called Xiao Er Mei, so small but beautiful and small but smart projects, which I think is important for these countries in the second phase of sort of after the big mega projects. Right now, what they need is digital infrastructure. Huawei and other, you know, telecommunication companies are responsible for about 70% of these telecommunication network construction in Africa. So I think this is the time when you need to think about what is the next stage, what these countries need in their next stage of development. So I think, and also, you know, some of the green energy projects, be it solar farms, be it, you know, windmills, be it, you know, and, you know, EV supply chains. I think this is what China sees as the priorities in the next stage of BRI. Now, finally, in terms of— you mentioned about the ASEAN— Malaysia is going to be the chair. And as we know, China has established the RCEP, right, the Regional Comprehensive Economic Partnership with ASEAN countries and Japan, South Korea, and so on. And I think that is very important. You know, Asia is really the next— I think it is the ongoing— it's It's not the next, it's ongoing leader of the global economy and technological innovations. And so I think that regional integration, right, to build that supply chain, to upgrade their infrastructure and their industrial structure and continue to propel the innovations, I think this is really important. And so I think China has always been really, really sort of keen on promoting regional peace and prosperity. So I think that will be a lot sort of the emphasis of China's next step in terms of investments, huge investment projects in various countries like Pakistan, Sri Lanka, and so on and so forth. But now you're also seeing a lot of Chinese private companies, Huawei being one, and BYD, CATL, They're going out and invest in Thailand, in Vietnam. That's a wonderful picture of the TVs, right? Cutting edge, beautiful, functional, and price competitive. Exactly. So I think, yes, I think that regional focus is going to loom large. And I think with the partnership and with China taking the lead role, I really think that the Asian economies have a lot of great futures. So I think that is why you're seeing the NATO is being more nervous than ever, right, trying to establish more footholds in Asia. And also the Biden administration has been talking about this IPAC, right, the Indo-Pacific Economic Framework. A lot of talking, not much has been done on the ground. So with, you know, their alternative Build Back Better, I know Professor Feng talked about, you know, the global partnership in infrastructure investment. A lot of talking, a lot of MOUs being signed, but nothing really concrete came out. And I think this is just very interesting if we wanted to get to really the West's reaction other than just throw out this or that, that trap diplomacy, right? What exactly tangible they're able to offer? I think that is a good question to be asking.

Very, very interesting. And I do have a follow-up question before I turn—

Can I add a little comment here?

Sure.

Um, first of all, I think I really appreciate Dr. Yan's comprehensive discussion of Asia's economy. Um, one, there's an old American saying is that vision without funding is hallucination.

Um, a good one.

And You can see the difficulty with, with B3W, for example, is that there is just no way within the American administrative structure to come up with funds to do that. They just cannot because of the way the U.S. government is structured. Whereas in China, it is far more directive in spending money, and if there's good reason to do it, you can do it. Secondly, the government in China has a tendency of longevity, namely it can continue on 5 years, 5 years, 5 years for 30 years or even longer. You just cannot do that here. Once you change the administration, the whole thing changes. So I think that these are some issues that we all need to start thinking about. Why is that in the last 10 years, even though in the beginning the BRI met some difficulties, but soon they learned to leverage their strong governmental structure and their willingness to learn about other people's history and other people's culture to do things so that they can do it collectively and always looking for win-win, win-win, not win-lose, not win-lose. And, and I think that That is the outcome of— you know, when I wrote the book on BRI, I have not thought about this yet. And in the last few years, it really came to me. Why is that the BRI can be successful, although it still has some ways to go, but there's a chance that it can really be successful. Look at the way they constructed the Bandung-Jakarta high-speed rail. And look at the way they constructed the— not high-speed rail, but fast rail going to Laos, allowing the Laos people a complete change of their economy. And when you change the economy of the Laotians, you change the people's livelihood. And And that's how things get better. I always wonder, why is it that as China gets better, you don't see Southeast Asia rushing into China like the South Americans or Mesoamericans rushing into the United States? Think about it that way. Why is it that Southeast Asians are now, you know, we know that Southeast Asia is the fastest growing economy in the world. In fact, last year, I think it was last year, the trade between Southeast Asia and China has surpassed that of European Union for the first time. And, you know, this tells you something, that the Southeast Asians have not had any conflict for the last 50 years. And as China grows, Southeast Asians grew— grow with it.

Very interesting, very interesting. Uh, I want to do a follow-up, Dr. Yang, then, then I'll go back to Dr. Da Shanfang because I need to talk about something specific from, from his book. So just follow up to what you said, Dr. Yang, earlier about China now embarking on a different strategy as far as small and smart ventures. Are you referring to, for example, because of what the European Union just announced about the seizing of the Chinese ventures in Europe? Is this because the reason for it?

I don't think this is completely a reaction to, you know, what the West, okay, you know, is doing. Um, but of course it wouldn't be a bad thing if that helps to, in a way, safeguard China's interest. But I think the reason, again, for the small but beautiful, small but smart, are again for two reasons. One is from a financial perspective, right? You have to really think about how you leverage your bang for bucks, right? So how much you are able to really have the largest impact using the smallest amount of necessary lending, considering the carrying capacity of debt. And for two, again, is, you know, countries have different needs through the stages of, of development. Um, so I know all these ideas of seizing China's infrastructure, reclaim so-called China's infrastructure. Um, again, I, I think that is basically a red herring. It's a, it's a, it's a, you know, it's, it's a lot more in terms of, you know, serving some political, you know, uh, purposes than, you know, what is really happening on the ground. So I think, you know, again, like what Professor Feng talked about, Dr. Feng talked about, China is adapting and it's changing. It's willing to learn. It's willing to, you know, see, you know, what developing countries need and have that win-win cooperation. Right. It's also the matter of, you know, how China benefits from all these partnerships. You know, it's no doubt. It's not a one-way street. China is not doing charity work here.

Of course.

China has its own need to recycle its reserves, the dollar reserves, to avoid only earning very low return on those reserves. China has large amount of industrial capacity. If it doesn't build enough, if it builds a lot at home, they wanted to maybe export some of those capacities. China has the interest of building more connectivity to boost trade, investment, and also uses of RMB. So I think all these motives are what is behind China's all these initiatives, and it benefits China, but of course it benefits other countries. I mean, even with World Bank, right? Their research has again and again supported this idea that China's project reduced the trade, the travel times, it increases trade, it increases income by all these participating countries and lifted 7.6 million people out of poverty. So I think, you know, there might definitely be some white elephant projects that are not really feasible and not making commercial sense. But by and large, I think, you know, again, China is doing it out of this mutual benefits of itself and also, you know, with developing countries. As not as much as a reactive way to counter the West. I think it's more the West seeing the geopolitical competition with China in African continent. It's much less from China's perspective see it that way.

Yeah.

Well, the West is always, it's always paranoid about everything China does. So guys, I want to share with you, by the way, I have a copy of Dr. Dashan because I am going to ask him to elaborate on one particular thing that I read in his book that I found interesting as a former professor myself. And he is into academia also, will make more sense to you once he explained it to us. And I had a chance to have it autographed by him, by the way, personally. He's like my neighbor, he lives close to me, so we meet once a while for a cup of coffee. So let me just share a quote with you, with all of you guys, but Dr. Dashaan, I would like you to elaborate elaborate on this. You wrote on page 299, uh, and I quote here, it must be recognized by China that many nations along the BRI route lag behind China in terms of science and technology, culture and economy. To this end, for such a nation to grow in all dimensions, China's assistance can have a palpable impact. End of quote. What did you mean by this, Dr. Fang? And also, where do you see the lack of the Western world when it comes down to education vis-à-vis China, or in comparison to China?

When I wrote that passage, I was, I was deeply involved thinking about the country that I came from, Singapore, Malaysia, and Southeast Asia in general. And having been in the United States as a phys— I'm a theoretical physicist, so I do know something about the Western technology. And I do see the gap between Asians and the Western scientific mindset. But I saw in the last 30 years the rapid catching up of the Chinese mindset in science and technology and economy, perhaps. I thought that unlike the West, which only wants students to come to the United States to study and perhaps even stay here and contribute to the United States. China has initiated a project called the BRI. A BRI is not just a project of building railways. It's not a project of building hospitals and so on. It is a project of helping other people to understand how to to upgrade your intellectual mindset that China has done in the last 30 years. When I went to China in 1983, the first time, I saw how devastated China was. In fact, I remember arriving in Shanghai on United Air in 1983. I look out the window, it was at night, it was pitch dark, and I said to myself, here's a city at that time of 15 million, how can it be pitch dark? Well, it was. And so in the last 30 years, China, by opening up, by not just copying everything from the West to China, And that's very important, not just copy everything, absorb everything, digest it, and then move forward. China essentially changed in the last 30 or 40 years, not 40 years, but 4 centuries. Look at China today and China 1983 when I went there. I don't know how to describe the difference. I think Dr. Yan probably could feel it herself, the difference between 1980 and 2024. So this is what China is trying, and in the last, by imposing a BRI onto the Chinese mindset, it began to let the Chinese understand, that we need to understand the world's history, the world's culture, the world— even food. You know, many Chinese say, "I don't like foreign food." Well, it doesn't matter whether you like it or not, you better learn how to appreciate it. For example, I still don't like French food, but I actually do eat it sometimes. And so on. You know, this is how human beings interact. You interact through understanding each other, respecting each other in the real sense, not in the superficial sense. And I think that that's what BRI Amazingly, I don't think Xi Jinping actually said that, you know, we want Chinese to look at the whole world equally. But I think that's what happened. So, BRI is a monument— to me, it's really, it's a monumental effort of the Chinese people that came out of 5,000 years of history. I am convinced if China did not accumulate the 5,000 years of non-stop history and mistakes and everything together, they may not be doing what they are doing today. And therefore, I am confident that, you know, Wang Yi just said something quite recently. He said, we don't want to be like America. Different from America. That word, those words are so important. In other words, it isn't that just we want to be strong militarily like America, or we want to be strong economically, but we want to be a nation that is different from America. We actually want to make sure that when people interact with us, we can grow together.

Very interesting. As a matter of fact, just to reflect on Mr. Wanyi's, uh, uh, statements, I've been thinking myself literally, uh, as to, okay, what's— once, once the dust settles regarding this rivalry between the US and China, and once China— yeah, yeah, it just— I like to think far ahead. That's just how my nature is, uh, and I knew that time is going to come when China sits on the top of the world. And the question that I will— I'm already asking myself is, what will China do at that time regarding the decision that is going to ought to make moving forward? And I'm already starting to, you know, think about it because I, I've been arguing this since the '90s, right? That's, uh, and I just find myself, uh, Dr. Yan, I want to turn this last to, to you here before we turn it to take some questions from the audience here. Uh, you are, uh, specialized in the MMT, Modern Monetary Theory. A lot of us here in the community and even here in the country are still so confused and perplexed about what is the MMT to begin with. But I'd like to have your input regarding, is there any link between the MMT and the BRI? Can it be linked? If there is any link to begin with.

Right.

So the modern monetary theory, I think it's really a tool, right? So it's an economic tool to allow us to understand monetary and fiscal operations. So I think, you know, there are many different dimensions, but I think the most important takeaway, at least to me, is this idea that what can be resourced can be financed. Because I think, you know, in today's world, a lot of times we're hearing we can't afford universal healthcare, we cannot afford, you know, free college education, we cannot afford, you know, taking care of our elderly because we don't have money, we don't have the finance. And we hear a lot of these kinds of, you know, talking points, right, when it comes to policymaking. You hear the United States saying that, you hear Germans saying that, you hear British government saying that, and so on and so forth. And also in the Global South, for that matter. But I think what MMT is saying is that finance can be created. A government that is using its own currency can afford anything that is denominated in that currency for sale. So you will never run out of dollars. You will never run out of RMB. What you could run out of are those real resources. As being labor or technologies or concrete materials and so on and so forth. I think this is very important to understand that a lot of times we're seeing everything through a money or financing view and we're losing the real insights of what is the barrier of growth and also to provide for all. I think that is very important from an MMT perspective is that We should not think about everything in terms of how do we reduce the budget deficit. But what we need to really think about is how do we close the real deficit gap, meaning that, you know, how do we fight climate change? How do we really make the planet more sustainable and so on? And how do we really provide for, you know, the poor, right? The general well-being of the humanities, as opposed to, you know, how much we can save on our deficits., and so on and so forth. So I think that is really the message. So when it comes to the BRI and everything else, I think, again, anything that has to do with financing, MMT has great insights to say. So one of the things I think, you know, it's interesting to think about, at least, you know, I just delivered some of these talks in some of the conferences. One of the things that we're talking about is, you know, today we have about 50% of of those low-income countries and close to a quarter of emerging markets are in the so-called debt distress. So they're having difficulties to make their debt repayments. But when you look at really the debt-to-GDP ratio, right, it's, you know, 60% at the most. When it comes to external debt, it's about 30% of the GDP for the developing world, which is much less when you think about, you know, the United States, over 100% debt-to-GDP ratio, Japan over 200% debt-to-GDP ratio. GDP ratio. Italy, 170%. This list goes on and on. So the question is, you know, why these other countries are not having difficulties paying the debt, where the developing countries are having difficulty, right, to pay the debt? Well, the reason is very simple. The US is spending dollars, right? The Italians are using euros, which is not completely under their control, but still, it's, it's good enough. Japan is using the Japanese yen. You know, China is using the yuan. But a lot of developing countries, because of this sort of currency hierarchy, they are not able to use their own currency to buy, you know, imports, right? They're forced to use dollars or euros. You know, that's— I think it's a main important question here, is that when you're using other countries' currency that you don't have control over, then you could be put in that debt distress situation, especially when you think about You talked about JPMorgan earlier in your remarks, and I think that's very important because the developing world these days, right, their debt owing to the private creditors is about 40-some percent of their total external debt. Okay. So what that means is that, first of all, they're having this liquidity and interest risks. Whenever the US raises interest rates, you can see their interest rate payments on their debt skyrocketing. Right. So this is important to keep in mind when you're owing to JPMorgan. Owing to these private creditors who are not interested in debt restructuring to help these developing countries cope with their financial difficulties. All they're in there are for the money, right? They charge hefty interest, and yet they're not, you know, they're not interested in restructuring the debt and giving more breathing room to these countries. All they want is put these countries on austerity, you know, take the money away, the last penny. From the poor to pay the creditors. And so that, I think, is really the problem. So MMT would say don't do that, right? If you can, try not to resort to this external borrowing in the foreign currencies. Even, I think, if the creditor is China, it's the same thing, you know. Try to borrow as much as, you know, as little as you can and use your domestic finance, um, as long as you're able to, you know, have the resources., then you should utilize the domestic finance to mobilize those resources, as opposed to, you know, borrow dollars to pay your public servant. Why, why do you need to do that, right? So I think, again, I think MMT provides that in terms of the analysis, what the developing countries should do, but also very important analysis on the global financial system, how unfair, unjust it is when one country, right, has $60% of the global foreign exchange reserves, 80% of the global payment system, over 80, 88% actually. That gives tremendous amount of privilege and power to this one single country. Yes, it's tremendous amount of power, right? The IMF, I think you mentioned earlier, the United States has the veto power, 16.5%, right? So whenever the US say, no, I don't want to issue more SDRs, that the IMF cannot do it, right? And so I think this is really to bear in mind when it comes to dollars. And the US can always say, no, I don't have the money for the poor countries, you know, it's not my problem. But the matter of fact is, yes, you know, the climate reparation, the US should take a role, the G7 should shoulder that cost. And they're able to create dollars out of thin air, right? They wanted to support their military 100% over $800 billion of military defense spending, they never say we're going to run out of money to support our military, right? But they could say, well, we run out of money to help the poor, or we run out of money to provide Social Security. So I think that is really, you know, from the MMT perspective, is to really see what is behind all this monetary operation, right? And who gets the power to create money, because money moves the world.. And we need to know, right, we're not completely, um, you know, it's not a, it's not a, it's not a real constraint. It's not like we don't have enough gold in the world so we can't spend, right? It's really the priorities, um, that, you know, those who are in power want to direct money and resources to certain areas and for certain purposes. And I think that is what MMT tries to reveal.

Interesting. I wish Argentina would have embarked on MMT to save itself from now the, the, the, the hole it's in for $45 billion. As a matter of fact, I found out about 2 weeks ago that it was a quiet meeting of the IMF. And the purpose for it was to refigure, almost restructure their approach to lending because they are realizing, you know, countries are not willing to go with IMF anymore. Especially after what China did with some African countries by restructuring the debt. And of course, we know Russia forgave about $20 billion in the, in the debt for some African countries. So, so I see your point, Dr. Yang, and I wish Argentina can, uh, uh, there is not a lot of understanding about MMT, uh, uh, here, even here in the US. And you know this one here, so it makes more sense. So, all right, let me take some question Yeah, go ahead, go ahead, Dr.

Yeah, let me just add one, one quick point on this. Sure. Yes, I think with China Finance is not only provide, you know, this economic benefits, but really it shows a different model, right? That there's no political strings attached. China does not go in the countries to impose austerity where the IMF has been doing this, right? And I've been reading this book called The World Protests, and it's very interesting, it's fascinating, you know, how the IMF really, you know, and, and World Bank of course, are really in a way destroying lives in all these developing countries. Right. There are 55% of the world protests, I think since 2000, are against this austerity measures. And 15% are directly targeted at IMF. So, I mean, it's really all these austerities really putting people's lives in jeopardy and not helping these countries to climb out of the debt. And also, I think China has a role to play. I did some research and I found out when China lends to some countries in terms of infrastructure, World Bank also tends to increase their financing for infrastructure for that particular recipient country. And every 1 percentage point of China's finance that a developing country received, it is associated with 15% of reduction of the IMF conditionalities. So that's what you're saying, you know, there's alternative, um, there is a strength, a strengthened bargaining power when China comes play.

Yeah, very interesting. And I did a, I did a video on this specifically about the IMF and the BRI. You know, I argued the, I argued the case for why, of course, what we talking about here. By the way, guys, I'm putting the link for you in the chat box, uh, for those who did not see it. So, and I argued the same point that, you know, uh, even IMF itself admits that the problems with some countries is not the Chinese loans, is the IMF loan, which I was surprised for IMF to even accept and admit its own, because we all knew this, that it's been going on for— All right, I'm gonna take, uh, uh, uh, some questions here. I'll start with you, Dr. Dashan, fine, thank— first, and the question is from Matt Backey. He's an avid supporter of the channel. Thank you very much, Matt. I'm aware of where Matt is. I'm not going to disclose his location right now because he's traveling, but he was kind enough even during his travel to watch this particular video here. Now the question is, Dr. Dasan, uh, he's saying, why China isn't working on its image, example media, on friendly countries such as Iran? I was recently in Iran and the majority of the people still have perception of China from 20 years ago.

Uh, I think that's— that is certainly true. Um, I think that, uh, again, it came back to what I discussed, uh, throughout today, is that China is very much an inward-looking country. And to a certain extent, you can understand why that is the case. A good friend of mind always say, uh, China has 1.4 billion people. If I can reach this 1.4 billion, I have enough work to do. Wow. Why do I, why do I need to worry about outside more? You know, I, I just can't handle it. Not realizing that the importance is not that you want to reach 1.4 billion, is that you want your concept, your mindset to penetrate into other areas, at least the good things that you have done. Um, and so they're changing. I think in the last 10 years, uh, you get— you can look at, for example, CGTN. They are having more and more sophisticated reporters, uh, appearing in their stations. But still, still hardly enough. And especially in terms of, you know, you talked about this, this person talked about Iran. Yeah. I don't know how many Chinese actually understand Iranian language. Sure. That's right. You know, I think that, for example, as I mentioned earlier in my discussion, that even though India is right next to us and India is a giant country, you don't have to, you know, whether you like them or not, it doesn't matter. They're not going to move away. And so you better understand them because you want a friendly neighbor rather than an unfriendly neighbor. And to have a friendly neighbor, you have to understand friend and the neighbor. And to understand the neighbor, you have to understand the per— the whole neighbor's complexity in all dimensions. And I think that using the media to describe this, they've gone a long way, but I think they have a much longer way. You know, if you look at the West, for example, the West is basically dominated by the global narrative is the West. Okay. And whatever they say, it doesn't matter what they say is true or not true. Somehow lots of people just assume that that is the truth. I think you can tell very clearly, even at the recent Olympic Games, how the US, the Western media, describes what's happening in Paris Olympics. You know, once they use the Western media to describe certain things, people just assume that is the truth. Wow. And I think that this is a challenge for China, perhaps for the next decade, that China will have to overcome this, not to just be the same as the Western media, but to be able to really truly appreciate other people and respect other people. Not that Chinese don't respect other people, they just don't care. And don't care may be worse than not respecting. And I think that the days that were China to be one of the top economic nations in the world, they can no longer afford not to care.

Indeed.

What a great answer. Thank you so much, Dr. Da Shan Feng, for this. Uh, next question for Dr. Yan. This is from Gatling Gun. Dr.— hello, Dr. Ho. Can— well, it's not for me, that's for Dr. Yan. I won't answer that one. Can China GDP surpass US GDP in the next decades?

Well, if you look at the PPP, China's GDP already exceeded the US GDP. So, you know, using the market exchange rates, then yeah, China is still behind. And, you know, I think the projection is yes, even though, you know, China has been projected to grow at a slower rate. And I think that is also China's own goal, right, not to have the high growth rate but high quality growth. So I think, but still, given the trend, you know, I do think that the Chinese GDP is on track of overtaking the US's in terms of the GDP size, again, measuring even market exchange rates. But again, I think the question is, you know, does that really matter, right? There are matters in terms of, you know, how much you can maybe spend on certain, you know, needs and so on and so forth. But I don't think really, you know, China's goal is not to grow as much as they can so that they can overtake the United States. I think China has made really conscious choice of, uh, you know, pivoting towards the quality of growth instead of the quantity. Um, so I think it's not really the matter of, you know, how much GDP you can get, but more, you know, at the per capita income level, at in terms of the basic welfare and and well-being of the citizens if China is able to achieve that. So we know that China's GDP per capita is still about a quarter of the US's right now. So that probably is not going to completely be changed within a decade. But that said, I think, again, China has its own goals. It has its own initiatives. If China will overtake the US or not, that might be a side product. It's not a byproduct, but it's not— I think China's attractive.

Very, very interesting. Uh, I just want to say, uh, thank you here to Noel.

May I add a little bit here? Sure.

Let me just say thank you to Noel here. Noel is an avid supporter of the channel. He's saying thanks to both of you for being here. Thank you very much, Noel. Go ahead, Dr. Dashan.

Yeah, I think that Dr. Yan really hit the nail on the head. And that is, I think, one of the, one of the most important thing about any government, whether it's US or China or anywhere else. The only aim it should have is whether its people's lives are getting better. That really is the only, only reason. Now, if that happens when the GDP overtakes the US, then the Chinese people are just as miserable as ever. What's the point? What's the point? And, and, and yet, if you look at what happened to China just the last 10 years, even if I went to third-tier or fourth-tier cities in China, the Chinese people's livelihood have gone much, much, much better. It came from many, many reasons. A, the transportation is a lot better, uh, the medical health is a lot better, although there's still a long way to go. Yeah, uh, people are just living better and better lives. And if the people can live better lives, what What more do you want? I think Lee Kuan Yew said that once in Singapore, you know, the aim is for Singapore is to make the people in Singapore live better lives. And I think in some sense, China is the global personification of that mission.

And if I may add to it, that's when the government works for the people. That's the way I look at it. Government for the people.

That's what Lincoln— that's what President Lincoln said.

Well, we're hoping to have that. So anyway, I can't thank you enough, Dr. DaShan Fang and Dr. Yan Liang, for being here. Especially for you, Dr. Yan Liang, I know you just flew back from a long flight from overseas. So instead of relaxing on a weekend, you are here with us, and I'm very, very grateful to you.

So she's still fighting.

Yeah, it was so— I mean, the community will appreciate this. I'm sure they're gonna put those comments. When they put the comments, they'll be very appreciative. I have a great community here. So, so I can't thank you enough, both of you, and I look forward to having you next time for another very interesting conversation. Wishing you a good weekend. Until next time.

Thank you so much.

Thank you.

Thank you so much.

My pleasure.

Yeah, bye.

All right guys, I hope you find this very informative. Both of them were kind enough to, to join us. I know it's the weekend, they can just relax, but instead they were willing to do this when I, uh, extended the invitation for them. Plus, I want you to hear a different perspective because that is the importance of why I bring in guests here. This is not about, uh, just spending time talking here because if you are not learning anything from this, then what's the point. And you all know by now, I am not doing this for just hanging out here. I got better things to do, but this is to me a mission in life, and this is what I found my call. And I, I will continue on bringing you guys, uh, some high-caliber guests that you will learn from. So I appreciate your, uh, I noticed the chat box here. I appreciate your, uh, civil discourse here in maintaining the, the civility in the conversation here, and appreciate you all for being here. Look forward to seeing you next time, and I'm wishing you a good and happy weekend. As always, remember, geopolitics impacts your daily life in more ways than one. Till next time, guys, bye-bye.