Michael Pettis
@michaelpettis.bsky.social
Senior Fellow at Carnegie China. For speaking engagements, please write to chinfinpettis@yahoo.com
Michael Pettis is an American professor of finance at Guanghua School of Management at Peking University in Beijing and a nonresident senior fellow at the Carnegie Endowment for International Peace. He was founder and co-owner of punk-rock nightclub D22 in Beijing, which closed in January 2012. .. more
Economics
76%
Political science
11%
How China Built a Chip Industry, and Why It’s Still Not Enough
www.nytimes.com
NYT: "While Washington’s export controls have slowed China’s chip development, they have added fuel to Beijing’s decade-long push to make strategic technologies like semiconductors and A.I. entirely at home."
www.nytimes.com/2026/02/14/b...
www.nytimes.com/2026/02/14/b...
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absorb it. If China does not act, we will see more barriers.”"
It seems that even the WTO is beginning to understand that a world of free trade is not one of large, persistent imbalances, and that, as Joan Robinson warned, these ultimately must set off counter-protection.
absorb it. If China does not act, we will see more barriers.”"
It seems that even the WTO is beginning to understand that a world of free trade is not one of large, persistent imbalances, and that, as Joan Robinson warned, these ultimately must set off counter-protection.
Reposted by Ian Hall
WTO chief urges China to shift on trade surplus
FILE: Director-General of the World Trade Organization (WTO) Ngozi Okonjo-Iweala at the World Trade Organization (WTO) headquarters in Geneva on February 16, 2024. (Photo by PIERRE ALBOUY /
business.inquirer.net
1/2
AFP: "WTO chief Ngozi Okonjo-Iweala on Friday urged China to change its growth model, arguing that its soaring trade surplus risked sparking new trade barriers. “The $1.2 trillion trade surplus is not sustainable because the rest of the world cannot...
business.inquirer.net/574306/wto-c...
AFP: "WTO chief Ngozi Okonjo-Iweala on Friday urged China to change its growth model, arguing that its soaring trade surplus risked sparking new trade barriers. “The $1.2 trillion trade surplus is not sustainable because the rest of the world cannot...
business.inquirer.net/574306/wto-c...
Europe's wage paradox
European leaders should find inspiration in Keynes' insight – that the world becomes richer when economies raise productivity and allow wages to keep pace.
engelsbergideas.com
5/5
choosing (i.e. out of manufacturing and into services).
The global economy, after all, must balance. If my share of global manufacturing expands, yours must contract. That's not ideology. That's just arithmetic.
engelsbergideas.com/notebook/eur...
choosing (i.e. out of manufacturing and into services).
The global economy, after all, must balance. If my share of global manufacturing expands, yours must contract. That's not ideology. That's just arithmetic.
engelsbergideas.com/notebook/eur...
4/5
in order to revive industrial policy objectives, either the EU must do the same, or it must accept the role of accommodating changes in the domestic economies of China and the US by allowing its own domestic economy to change in directions not necessarily of its own...
in order to revive industrial policy objectives, either the EU must do the same, or it must accept the role of accommodating changes in the domestic economies of China and the US by allowing its own domestic economy to change in directions not necessarily of its own...
3/5
The policy options for the EU are simple. If China and a few other large economies have been intervening extensively for years in their external accounts to support domestic industrial policy goals, and the US is increasingly intervening in its own external accounts...
The policy options for the EU are simple. If China and a few other large economies have been intervening extensively for years in their external accounts to support domestic industrial policy goals, and the US is increasingly intervening in its own external accounts...
2/5
"Shifting trade and political relations with the world's biggest powers," Reuters adds, "have been squeezing Europe for years, and leaders met yet again on Thursday to brainstorm ways to survive aggressive economic rivalry from the U.S. and China."
"Shifting trade and political relations with the world's biggest powers," Reuters adds, "have been squeezing Europe for years, and leaders met yet again on Thursday to brainstorm ways to survive aggressive economic rivalry from the U.S. and China."
US tariffs, Chinese competition weigh on EU trade, data show
The EU's trade surplus kept shrinking, data showed on Friday, as tariffs weighed on exports to the U.S. and rising Chinese imports crowded out domestic production, highlighting existential threats to ...
www.reuters.com
1/5
Reuters: "The EU's trade surplus kept shrinking, data showed on Friday, as tariffs weighed on exports to the U.S. and rising Chinese imports crowded out domestic production, highlighting existential threats to the bloc's economic model."
www.reuters.com/world/china/...
Reuters: "The EU's trade surplus kept shrinking, data showed on Friday, as tariffs weighed on exports to the U.S. and rising Chinese imports crowded out domestic production, highlighting existential threats to the bloc's economic model."
www.reuters.com/world/china/...
4/4
I would add that if this infrastructure were indeed net productive for the economy, i.e. if it generated more economic value than it absorbed, funding more infrastructure spending with long-term debt would actually make debt management easier, not harder.
I would add that if this infrastructure were indeed net productive for the economy, i.e. if it generated more economic value than it absorbed, funding more infrastructure spending with long-term debt would actually make debt management easier, not harder.
3/4
If local governments do prioritize debt control over rapid expansion in infrastructure investment, as Fitch reasonably suggests, then either GDP growth must be lower or the locus of spending must shift to some other entity, for example the central government.
If local governments do prioritize debt control over rapid expansion in infrastructure investment, as Fitch reasonably suggests, then either GDP growth must be lower or the locus of spending must shift to some other entity, for example the central government.
2/4
Fitch adds: “We believe local governments will prioritise debt control rather than pursue rapid expansion in infrastructure investment to prop up growth,” citing data from 23 Chinese provinces, regions and municipalities.
Fitch adds: “We believe local governments will prioritise debt control rather than pursue rapid expansion in infrastructure investment to prop up growth,” citing data from 23 Chinese provinces, regions and municipalities.
sc.mp
1/4
SCMP: "Major provinces are budgeting for 2 to 3 per cent growth this year in general public operating revenue, broadly in line with last year but below broader economic growth targets, Fitch Ratings said in a research note."
sc.mp/n5seb?utm_so...
SCMP: "Major provinces are budgeting for 2 to 3 per cent growth this year in general public operating revenue, broadly in line with last year but below broader economic growth targets, Fitch Ratings said in a research note."
sc.mp/n5seb?utm_so...
3/3
Large manufacturers, many of which have been having trouble making payments out of cashflow earnings, have paid their suppliers instead with (mostly six-month) IOUs, which has created additional debt and has passed on liquidity pressures down the line.
Large manufacturers, many of which have been having trouble making payments out of cashflow earnings, have paid their suppliers instead with (mostly six-month) IOUs, which has created additional debt and has passed on liquidity pressures down the line.