DistantNews
Support us
🇹🇼 Taiwan /Elections & Politics

Chen Chong: G20 Finance Meeting Offers a New Test of the Contest Over a ‘New Plaza Accord’

From Liberty Times · () Chinese

Translated from Chinese and summarized by DistantNews. Read the original for the full story.

At a glance

Analysis Named sources Context piece
  • Former Taiwan premier Chen Chong said the G20 finance ministers’ meeting failed to produce a joint communique after China opposed language targeting non-market policies that worsen trade imbalances.
  • Chen described the dispute as a possible indicator of competition over a “New Plaza Accord” and said the gap in US-China financial power has narrowed this century.
  • He said China’s CIPS and CBETS payment systems still need time to mature before Beijing can fully counter US financial sanctions.

The G20 finance ministers’ meeting ended without a joint communique after China opposed wording that called for action to eliminate non-market policies and practices worsening trade imbalances. For former Taiwan premier and New Generation Financial Foundation chairman Chen Chong, the deadlock offers a measure of the deeper struggle over what he calls a “New Plaza Accord.”

In an essay titled “The Financial War That Will Eventually Come to a Showdown,” Chen said the gap between the United States and China in financial power has narrowed since the start of this century. Their competition, he argued, is dynamic, and neither side will simply allow the other to expand its advantage.

US signature was written in pencil

· Mark CarneyThe Canadian prime minister’s phrase was cited by Chen Chong as a comment on the reliability of US commitments.

Chen said US financial influence rests on rules Washington shaped over decades to preserve the dollar’s dominance. He traced that position from the weakening of the British pound during World War II, through the 1944 Bretton Woods agreement, to President Richard Nixon’s 1971 decision to end dollar convertibility into gold. The United States later reinforced its role through SWIFT, which standardized cross-border bank payments, and the development of the petrodollar system in 1974.

The Financial War That Will Eventually Come to a Showdown

· Chen ChongTitle of Chen’s essay on US-China financial competition.

Other currencies, including the yen and euro, have challenged that position, Chen said, but US countermeasures limited their progress. China has sought alternatives through the Cross-Border Interbank Payment System, or CIPS, launched in 2014, and the CBETS digital-currency platform. CBETS completed its first transaction on July 16, he said, although CIPS still relies partly on SWIFT through indirect participating banks. China is now planning direct links between commercial banks for cross-border payments.

Chen said these systems will need time to expand and mature before they can support a dual- or multicurrency system or provide a full response to financial sanctions. Under normal conditions, he judged that a military conflict before 2028 would be difficult because China’s preparations to bypass SWIFT and operate CIPS remain incomplete. He warned against relying on promises that can be erased like pencil, while urging attention to gradual changes in the international financial landscape.

economic D-Day is completely ineffective

· Paul KrugmanKrugman’s reported description of proposed US economic pressure against Iran.
About this summary

Originally published by Liberty Times in Chinese. Translated, summarized, and contextualized automatically by DistantNews, with a note on how the source frames the story. Not individually reviewed before publishing. How this works.

More Stories

From Our Blog