xiaohongshu

China allied with the US to fight against the USSR - the country that kickstarted its industrial, scientific and technological base - not even 20 years after the US killed half a million People’s Volunteer Army during the Korean War.

Vietnam was carpet-bombed to hell by the US with millions and millions of casualties, and yet they are just as keen to serve the US empire today, and has been so since the end of the USSR.

This is just socialist countries using their understanding the material reality to do what they have to do to get ahead in the world, because they very consciously do not want to end up like the DPRK. To pretend otherwise is to assume that the leaders of these socialist countries are stupid.

It’s not the “importance” in trade, it’s how you want to build a new future economic doctrine that can make these developing countries become independent from US imperialism.

I have said this many times, the current trajectory with Trump’s tariffs is just going to intensify the competition of all these countries with China as they have to sell their surplus goods elsewhere. They cannot compete with China - this is a fact. I’m not going to sugarcoat it, but these countries do not have the capacity nor the technology to compete with the Chinese export industries.

This is why many countries are desperately trying to make deals with Trump, because there is nowhere else for their surplus goods to go, and this makes them vulnerable to financial warfare from the US.

More investments from China simply means China helping to build the supply chain for the US, for the US finance capital will take over these assets when businesses begin to fail and countries go into recession.

Ironically this was exactly what happened after the 1997 Asian Financial Crisis with mass IMF bailouts that killed the rise of ASEAN as a regional economic power. And guess who’s in charge of Trump’s trade negotiations these days? That’s right - it’s Scott Bessent. Read my comment here about Bessent and the Asian Financial Crisis.

At a meeting in ASEAN, Chinese Foreign Minister Wang Yi stressed that American tariffs are trying to prevent the growth of countries in Southeast Asia. Cambodia, which was slapped with a 36% tariff, was cited as an example of Washington's pressure.

Then why don’t just China use its vast amount of wealth to purchase from them? Why not let all these countries tap into the huge Chinese consumer market? Right, because China will then have to increase the wages of its own working class and that will hurt its own export industries against these other Southeast Asian countries.

Ridiculous neoliberal brained defense of free market. Returning to the status quo = wage depression for the rest of Global South countries, but good for China to keep its 5% growth to prop up the financial sector and property markets I guess

western economies can't just keep running larger and larger deficits forever

The question is, why not?

You have the entire developing world having listened to the IMF that their way to “climb up the value-added chain” is to transform their economy into an export-oriented economy at the expense of serving domestic populations (of course, also under much coercion of the global imperialist institutions like the World Bank), so if no other country is going to take up their surplus export goods, they still have to sell to the country that is willing to run a deficit to buy from them.

The main issue for the US trade deficits comes internally, as decades of de-industrialization (a very deliberate neoliberal policy to crush trade union movements as its economic policies failed to resolve the inflation and later stagflation problems starting in the 1970s) disenfranchised its own domestic working class base, which after enduring the severe impact of the 2008 GFC, finally unleashed their discontent in the form of populist movements in the mid-2010s represented by Bernie Sanders and Donald Trump.

What Trump has been doing since his first term (and followed by Biden) was exploring the means to resolve this inherent contradiction of American capitalism - how can the US continue to dominate while also reducing its own trade deficit.

There are plenty of non-Marxist/non-materialist “analyses” on the social media, mostly libertarians who fell for the Austrian school myth, that talks about dollar hegemony in the form of Petrodollar and various other nonsense, but truly one needs to understand it at the real production and consumption level taking place in an international system of free-floating exchange rate regimes (as opposed to the gold standard/Bretton Woods fixed exchange rate regimes that no longer happen and many still cannot come to terms with)

No disagreement there. We’re seeing precious resources being funneled into boosting defenses instead of creating robust safety nets for the society that improves living standards.

The empire does what it does best at creating chaos and regional instability, which amplifies the risk of a war and putting everyone involved under intense pressure, and the fallout of which will create new opportunities for multinational capital to harvest. If this is the strategic goal of the empire, it appears to be working.

Thank you for the detailed explanation!

Don’t have access to the paywall material, but anyone who can read French, can you summarize how exactly did they propose to resolve the following problems?

1. That Europe and China are direct competitors and increasingly China has become a major and superior supplier in high end goods that used to be dominated by the Europeans
2. The mercantilistic relationship between Europe and China as a consequence of Trump’s global tariffs, as China is being forced to dump their cheap goods into European markets and prompting the recent French finance minister’s call for trade barriers to prevent Chinese goods from killing European domestic industries
3. Reduced competitiveness of European goods against their Chinese counterparts following the loss of cheap energy input from Russian suppliers

As you can see, nothing short of a complete overhaul of the neoliberal economic order can these fundamental contradictions be resolved. And if they are not proposing that, it’s not serious and should be treated like a fantasy novel.

I’m not going to comment on the national security aspect nor am I qualified to do so, but from an economic perspective it makes sense if you understand what’s going on in China’s economy these days.

I’m not going to repeat many things I already said but surely you know that government finances aren’t doing so well since Covid, tax revenues actually decreased the last financial year and since China adheres to IMF guidelines, it is afraid of running large deficits and has to find ways to make up for the budgetary gap.

With consumption remaining dampened and failed to drive up corporate profits and return of investments (i.e. failing to drive wage growth for workers), and the expensive outstanding interest and debt servicing for many corporations and local governments, turning toward militarization helps alleviate two critical problems at the same time:

1. it softens the impact of economic downturn by driving investment into another sector
2. it alleviates the high youth unemployment problem that currently exists

It is not a coincidence that I also noticed an increase in military recruitment ads in China. In fact, this is not even particular to China. The world is turning towards militarization as the global economic instability is amplified further under Trump’s erratic policies. The US, Europe and many other countries are also investing heavily into militarization.

The world is heading back to the 1930s once more with intense militarization that increases the risk of a global conflict, if not another world war. Lenin already commented on this a hundred years ago as soon as WWI ended.

Absolutely. But the India-Pakistan conflict recently also exposed the mediocrity of European and Russian weapons systems that had been hyped through the roof for years.

Egypt confirms acquisition of Chinese HQ-9B long-range air defence system Military Africa

Egypt has officially confirmed its deployment of the Chinese HQ-9B long-range air defence system, a move that marks a notable enhancement of its military capabilities and reflects a growing partnership with Beijing. This confirmation came from retired Major General Samir Farag, a former high-ranking official in the Egyptian Armed Forces, during an interview on Sada El-Balad TV. Farag revealed that Egypt’s arsenal includes various modern defence systems, with the HQ-9B—a system comparable to Russia’s S-400—being a key component. This disclosure, reported by Israeli media outlet nziv, reveals Egypt’s strategic shift toward diversifying its arms suppliers and strengthening its air defence network. The HQ-9B’s advanced capabilities, including its ability to engage a wide array of aerial threats, position Egypt to better address regional security challenges while navigating complex geopolitical dynamics.

…

Egypt’s decision to acquire the HQ-9B stems from a combination of strategic, economic, and political factors. Frustrated by Western restrictions on arms sales, Cairo has turned to China for advanced systems that come without the political constraints often imposed by the United States and European nations. For instance, Egypt’s F-16 fleet, supplied by the U.S., is equipped with outdated AIM-7 Sparrow missiles, while France has withheld long-range MICA missiles for its Rafale jets. In contrast, China’s export terms are more flexible, offering Egypt access to cutting-edge technology without restrictive end-user agreements. The HQ-9B’s cost-effectiveness also makes it an attractive alternative to pricier Western systems like the U.S.-made Patriot PAC-3, which carries both a higher price tag and political strings. Compared to Russia’s S-400, the HQ-9B provides similar capabilities at a lower cost, though it lacks the same combat-tested pedigree.

The timing of this acquisition is tied to Egypt’s evolving security concerns. Tensions with Israel over its actions in Gaza, along with Turkey’s support for Islamist groups in Syria and Libya, pose direct threats to Cairo’s interests. The Western-backed assault on Libya in 2011, with Turkish involvement, left a lasting impression on Egyptian leadership, reinforcing the need for independent aerial warfare capabilities. Egypt’s air force, while sizable, remains constrained by its reliance on Western suppliers, who have been reluctant to provide the most advanced munitions. The HQ-9B, alongside other Chinese systems like the Wing Loong-1D drones and reported interest in J-31 stealth fighters, signals a deliberate pivot toward Beijing as a defence partner. This shift not only enhances Egypt’s deterrence capabilities but also strengthens its bargaining power with Western allies, who may now feel pressure to loosen restrictions on arms sales.

The HQ-9B’s deployment in Egypt also has broader implications for the Middle East’s balance of power. Israel, which maintains a qualitative military edge in the region, must now account for Egypt’s bolstered air defences. The system’s ability to detect stealth aircraft and intercept precision-guided munitions complicates Israel’s operational planning, particularly in scenarios involving strikes on Egyptian targets. Turkey, another regional rival, could face similar challenges if tensions escalate, as the HQ-9B extends Egypt’s defensive reach. Beyond Egypt, China’s growing role as an arms supplier challenges the dominance of Western and Russian systems in the Middle East. Countries like Turkmenistan, Uzbekistan, and Pakistan have already acquired the HQ-9B, drawn by its affordability and China’s willingness to transfer technology without political preconditions. Egypt’s procurement could inspire other nations to follow suit, further eroding the West’s influence in the region’s defence markets.

This is the end of Russian military industrial complex. The India-Pakistan conflict truly marked the turn of the tide and the ascendence of Chinese military technology displacing those of Russia’s among Global South countries.

I predict Russia’s economy will continue to worsen as it loses global market in military export, one of the few things Russia is actually good at and a major source of foreign income, and will in turn stifle investments in research and development over the longer term, ultimately leading to the demise of its status as a global leader in military technology.

PS. Europe’s as well, no doubt.

Very nice write up.

Can you comment on the Brazilian soybean production and supply chain with respect to foreign vs local bourgeois ownerships?

I did some homework a while back and the data suggest that apart from the farming, the vast majority of the soybean supply chain in Brazil is under control of foreign multinational corporations:

From Transparency in Global Agribusiness: Transforming Brazil’s Soybean Supply Chain Based on Companies’ Accountability:

China's "diplomacy for economic interest" is impossible if the US will just attack and destroy your "trading partners".

Are you seriously suggesting that Israel and Palestine are more important trading partners for China than the US?

The entire point of the rare earth export restriction from China is to let the US know that it cannot survive without China, and that they both cannot live without each other.

If China truly wants to punish the US and decouple, it could just… stop selling stuff to the US? Why waste all the efforts into negotiation with the US when it could be forging a new economic bloc with the rest of the world?

Well, turns out China has benefited so much from dollar hegemony that it is already addicted to it. The whole rare earth card was to tell the US to stop walking away from their marriage.

If you can't understand this then god you're truly beyond hopeless.

Oh I understand, I simply question the “China’s foreign policy position is unsustainable” notion as an objective statement, given what we’ve seen with its foreign policy history over the past few decades.