Beijing [China], July 24 (ANI): The United States’ willingness to reduce or completely cut off China‘s access to the US dollar system — Swift — has sent a sense of uneasiness in Beijing about the potential ramifications of a financial war with Washington, the South China Morning Post reported.
The Society for Worldwide Interbank Financial Telecommunication (Swift) is a network used by worldwide banks to send and receive information about financial transactions. It is one of the pieces of infrastructure that underpins the anchor role of the US dollar in international trade and investment.
Globally, banks have correspondent relationships with US banks, through which they conduct US dollar transactions. Under this payment system, the White House can order US banks to stop processing transactions with certain individuals, institutions and countries, thus, denying them access to the US dollar payments system.
While China‘s Communist Party (CCP) seems to be tensed about its future amid the growing worldwide lashes against it over Xinjiang and Hong Kong, some have come out to soothe their fears.
Some political thinkers, who are supporters of the CCP, have opined that the US will not take drastic decisions with regard to China as it has with Iran and North Korea as the move will pose a risk to the US and global economy.
However, the risk for China is real as the US could use the US dollar‘s hegemony to attack Beijing if the relations continue to worsen, the thinkers said.
This sense of fear and debates have come in the backdrop of the US announcing sanctions on Chinese officials and entities behind the human right violations in Uighur-populated Xinjiang and undermining Hong Kong’s autonomy.
Recently, US Secretary of State Michael Pompeo announced visa sanctions on certain employees of Chinese technology companies including Huawei that provide material support to regimes engaging in human rights abuses globally.
Earlier, he had announced visa restrictions on some Chinese officials under the Reciprocal Access to Tibet Act, 2018.
“Today I am announcing visa restrictions on PRC government and Chinese Communist Party officials determined to be ‘substantially involved in the formulation or execution of policies related to access for foreigners to Tibetan areas,’ pursuant to the Reciprocal Access to Tibet Act of 2018,” Pompeo said on July 7.
The US had also announced the ending of the US-origin defence equipment exports to Hong Kong after the Chinese government imposed national security law in the city.)
US taking China-US relationship onto wrong path, says Chinese Embassy
The Chinese Embassy in Washington on Wednesday (local time) accused the US of taking the relationship between the two countries down a wrong path and said it was time to return to the right direction.
“If the #ChinaUS relationship is a vehicle, the US is taking it onto a wrong path, and worse still, it is hitting the accelerator. It’s time to step on the brakes and return to the right direction!” the Chinese Embassy in the US said in a tweet.
Earlier, the US State Department ordered China to close by Friday its consulate in Houston, Texas, over accusations that it engaged for years in massive illegal spying and influence operations in the US.
“The People’s Republic of China has engaged for years in massive illegal spying and influence operations throughout the United States against U.S. government officials and American citizens. These activities have increased markedly in scale and scope over the past few years,” US State Department Spokesperson told ANI.
“As detailed by Secretary of State Pompeo, FBI Director Wray, and Attorney General Barr in public remarks, PRC officials have interfered in our domestic politics, stolen U.S. intellectual property, coerced our business leaders, threatened families of Chinese Americans residing in China, and more,” the State Department spokesperson said.
In an earlier statement, the Chinese Embassy slammed the US for “abruptly” demanding closure of the Chinese Consulate General in Houston.
“It is a political provocation unilaterally launched by the US side, which seriously violates international law, basic norms governing international relations and the bilateral consular agreement between China and the US. China strongly condemns and firmly opposes such an outrageous and unjustified move which sabotages China-US relations,” the Embassy said in a statement available on its website.
The two countries have sparred over a range of issues in recent times — China’s move to impose national security law in Hong Kong, its human rights violation in Xinjiang and territorial aggression in the South China Sea have all drawn fierce criticism from Washington. (ANI)
Chinese yuan weakens to 6.9938 against USD Friday
Beijing [China], July 24 (Xinhua/ ANI): The central parity rate of the Chinese currency renminbi, or the yuan, weakened 17 pips to 6.9938 against the U.S. dollar Friday, according to the China Foreign Exchange Trade System.
In China’s spot foreign exchange market, the yuan is allowed to rise or fall by 2 percent from the central parity rate each trading day.
Parity rates are found in foreign exchange (forex) markets. Two currencies are at ‘parity’ when the exchange rate between them is exactly one to one.
The central parity rate of the yuan against the U.S. dollar is based on a weighted average of prices offered by market makers before the opening of the interbank market each business day. (Xinhua/ ANI)
