The Western Pacific remains a highly active theater defined by sustained U.S.-led military exercises and escalating great power competition. Key evidence includes continuous joint operations, such as RIMPAC 2026 in Hawaii and the deployment of CSGs into the South China Sea, juxtaposed with increased naval activity from both China (PLAN task groups) and Russia near Japan's critical straits. These movements underscore a strategic push by non-allied powers to assert presence and challenge regional norms. Policy implications dictate that allied nations must maintain robust multilateral cooperation and interoperability to safeguard freedom of navigation and manage escalating tensions in the Indo-Pacific.
Time to Stop Forecasting China’s Surplus Away
English Summary
This CFR analysis argues against forecasting China’s external surplus to decline, citing a persistent trend toward a 10% of GDP surplus driven by China’s high savings rate (over 40%). Evidence includes the IMF’s consistent underestimation of the surplus, exacerbated by China’s property bubble burst and a depreciating exchange rate. The article highlights a systemic bias within the IMF towards deemphasizing imbalances, and points to the outlier nature of China’s savings rate compared to economies with similar rates. Consequently, policy should shift away from advocating for a reduction in China’s surplus and instead acknowledge China’s evolving comparative advantage, particularly in industrial policy.
中文摘要
本CFR分析認為不應預測中國的外部貿易盈餘將下降，理由是中國持續呈現10%的國內生產總值（GDP）盈餘的趨勢，這主要源於中國的儲蓄率高達40%以上。 證據包括國際貨幣基金會（IMF）對盈餘持續低估，並受到中國房地產泡沫爆發和匯率貶值的加劇。 該文章強調了IMF內部存在的一種系統性偏見，即對淡化不平衡現象的傾向，並指出中國儲蓄率在類似儲蓄率的經濟體中是極端情況。 因此，政策應從推動減少中國盈餘轉向，並承認中國不斷演變的比較優勢，尤其是在工業政策方面。
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