No guessing as to why Trump’s panicky
Published on: Sunday, August 11, 2019
By: Datuk John Lo

For more than a year, Trump has made numerous threats against China and other countries, including US allies in Europe, Japan and South Korea, even to emerging countries like Vietnam, Cuba, Venezuela. Unilaterally, he withdrew from the Paris Accord on environment, nuclear treaty which has been worked out between Iran, EU countries and INF with Russia. In short, he has been busy picking fights and bullying every country. China is his main target, rattling about balance of trade, currency manipulation, unfair trade practices and IP theft. He could have brought all these up to WTO, IMF, World Bank which are under American control. Instead, he has chosen unilateralism. He is becoming a lonely man very fast as most countries have ignored his below par behaviour and mutterings.

Keeping to age old Confucius philosophy and the Sun Tzu’s “Art of War”, Xi Jinping has not even issued a statement in response to Trump’s daily irrational babblings and rankling. The more he does it, the more mistakes he will make. If Trump thinks he can bully China and other countries into submission, he is making a big mistake. China is not China 2o or even 10 years or China in the opium war. China is now USA’s biggest creditor.

Since year 2000, China has quietly caught up with and overtaken America in many fields. Today, I want to focus on China’s rise in banking and corporations. It can be recalled that only 20 years ago, Chinese banks and corporations are nothing to the Americans. They didn’t even bother as much as to cast an eye on them. In 2019, the Americans have wakened up to find the Chinese banks are dominating the world’s 10 largest bank ranking and there are more Chinese corporations than American in the Fortune 500. Both these rankings are from the west, China has no say or influence in these rankings.

For details on the banking raking, please read Significantly, the first 4 top banks of the largest 10 are all Chinese with another one in 9th position. There are 5 Chinese banks in the top 10, making it 50pc. World’s 10 largest banks are 1st ICBC [China], China Construction Bank Corp [China], 3rd Agriculture Bank of China [China], 4th Bank of China [China], 5th Mitsubishi UFI Financial Group [Japan] , 6th JP Morgan Chase [USA], 7th HSBC Holdings [UK], 8th Bank of America [USA]. 9th China Development Bank, 10th BNP Paribas [France]

USA used to be the “taiko” on this list with a sprinkling of Japanese banks.

Only 2 US banks have made it in 2019. Citi Group, Wells Fargo have been pushed to below the psychological top 10 positions.

Also significantly, ICBC is no. 1 in asset, deposit, customers, and 1st tier capital which is the acid test for health indicators for banks, debunking American fear mongering that Chinese banking system is on verge of collapse. The ranking has been complied by The Banker annually, which is the world’s oldest Global Financial Intelligence magazine [1926]

American companies used to have near monopoly on the list of Fortune 500 which is the most famous ranking for companies in the world. Low and behold, there are more Chinese companies than American ones in the 2019 list—- China has 129 largest companies by revenue vs to US 121. The Fortune magazine has given a dramatic title to its ranking news article with the headline “It’s a China World” on 22 July 2019. For more details, please read

On the credit card/payment systems which is another “financial power” indicator, China’s “Alipay”, “WeChat pay” and others have all but overwhelmed American icons American Express, Visa and Mastercard. The Chinese electronic payment system is a lot more efficient, cheaper and faster. Credit cards as we know them today will soon disappear. Credit cards are archaic in China.

Money controls all. Losing out in banking, Fortunate 500 in numbers and payment system are clearest signs of American decline, not only in financial terms but as a country as a whole. Now you know why Trump is panicky like a mad man.

China’s ability to either catch up or overtake USA in finance is a reflection of Chinese robust economic advance in many other fields of endeavour over USA. Trump’s irrational, bullying ways towards countries can only advance acceptance of China as the more dependable multilateral super power. This will eventually lead to the dethroning of US$ as the only international currency. Already happening is that many countries have begun to accept each other’s currencies, bypassing US$, for example, India and Russia, China and Russia, EU payment for Iran oil, Iran’s sale of oil and Saudi Arabia and China.

Declining use of US$ internationally will lead to its inevitable decline in value and cause inflation within USA. Expediting this inevitable US$ decline is that America is the world’s biggest debtor to other countries and more than US$22 trillion in national debt. He talks big because that is him and also, he is facing an uphill 2020 re-election battle.

The trade war has turned nastier because of Trump’s uncouthness, superiority complex. As you can see, it is not only in trade that US is losing the top dog position. It is not China causing the rot. it is the rot and greed by the few from within US that is causing its long term down fall. American productivity is falling as income gap between the haves and have nots is widening rapidly 

US and the west have invented free trade, free market, free competition, globalization and rule based international trading system. All these the Americans have thrown out of the window when it’s fear of losing its top position has become apparent, blaming on other countries for its decline. US is fast becoming a bitter, inward country, lacking in morale high ground to lead the world.

In all these, where lies Malaysia’s strategic position, bearing in mind that we are a small nation of 32 million with a mid to small size economy? Preference would be to steer a middle way. Like Tun M has said, given no choice, Malaysia should side with China for good reasons: [a] China would not force anything down our throat like regime change, nor would it invade us, bomb us into submission all of which US has done in the Middle East. [b] Not much to choose – US is a declining power while China is a growing power. [c] China is nearer to us than US. [d] 1.4 billion Chinese with growing wealth is the largest market. [e] The Chinese love our Mau Sang Wang and many other products. Don’t expect USA to import durians. 

Sabah does not need to think twice. We must go with China as America does not want anything from Sabah nor will it invest any money here. Amercian investment is only for W Malaysia. Not Sabah. American tourists? Forget about it. Will US ever set up a consulate like China? 

Never. The only possibility of US interest in Sabah is if we allow them a military base. They love military bases to show off its military power. Present US/China worsening relationship can present new opportunities. 

My recommendation is for Sabah to stay focus and add value to existing/new economic relationship with China: [a] look for high value tourists. [b] develop Chinese market for our agriculture and marine products. [c] seek collaboration in providing oil/gas services for exploration in South China Sea. Remember that we are only 100 or so nautical miles from Spratly and other potential oil/gas rich deposits.

Important for Sabah to know which side of the bread is our butter. Our butter is on the Chinese side, not America.

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