Paranoid? Perhaps.

A friend recently suggested that I might be a little paranoid about the West and about pro-Western forces.

Perhaps I am.

But there are certain things that irritate me almost instantly.

One example is when I read an article — usually in the South China Morning Post — and the journalist feels compelled to introduce China as: “the world’s second-largest economy.”

Why is that qualification necessary every bloody time China is mentioned?

China did not become the world’s second-largest economy yesterday. It is hardly breaking news. The phrase has long since become a stale, tiresome tagline, endlessly regurgitated by writers who seem determined to keep reminding readers that China is still “second” — invariably to the United States.

There is a Chinese expression, 画蛇添足 — having drawn a perfectly good snake, you decide to add legs to it.

That is precisely how I feel.

China is China. If the subject is its economy, by all means give us the relevant figures. But why this almost ritualistic need to remind readers that it is “second”?

Second to whom?

Of course, we know the answer: the United States of America.

To me, this constant ranking reflects something much deeper than innocent description. Either the writer has stopped thinking and is merely repeating a journalistic cliché, or he remains intellectually trapped in a world in which the United States must somehow occupy the top position and everybody else has to be ranked beneath it.

What amazes me further is that quite often the writer has a Chinese name!

Perhaps this is what my friend means when he says I am paranoid. But I do see the same habit everywhere.

The United States is routinely described as “the world’s largest economy”, “the richest country in the world”, “the world’s most powerful military”, “the leader of the free world”, and who knows what else.

My question is very simple: What do these labels actually mean today? And largest by What Measure?

Yes, measured in nominal US dollars, the United States remains the world’s largest economy. No argument there. But economics is not a beauty contest in which one number settles everything.

Measured by purchasing-power parity — which attempts to compare what money can actually buy inside different economies — China has already been larger for years. World Bank figures for 2025 put China’s economy at roughly US$41.3 trillion in PPP terms, compared with about US$30.8 trillion for the United States. Yet in nominal-dollar terms, the United States was still substantially larger: about US$30.8 trillion against China’s US$19.5 trillion.

So which country has the “larger economy”?

The answer depends on what you are trying to measure and that is precisely my point.

Repeating “the world’s second-largest economy” as though the issue were settled by a single nominal-dollar league table is intellectually lazy.

More importantly, what matters to me is not merely the size of an economy on paper but what that economy can actually do. 

Can it build?

Can it manufacture?

Can it provide infrastructure?

Can it produce the machines, ships, power plants, batteries, vehicles, electronics, chemicals, steel and industrial equipment upon which a modern civilisation depends?

Can it mobilise resources when necessary?

Can it educate enough engineers and scientists?

Can it sustain its population without living indefinitely on borrowed money?

These questions tell me far more than a nominal GDP ranking.

The Difference Between Financial Wealth and Productive Power
Superficially, the United States remains extraordinarily wealthy. Nobody needs to deny that. It has some of the richest individuals and corporations humanity has ever produced. Wall Street can move trillions of dollars around the world. American technology companies command astonishing valuations. The dollar still occupies a privileged position in international finance.

But financial wealth and productive capability are not the same thing.

America has spent decades shifting production abroad while congratulating itself on becoming a sophisticated “service economy”.

China did almost the opposite. It built factories. It built ports. It built roads. It built high-speed rail. It built power stations. It built supply chains. It trained engineers. It accumulated industrial capability on a scale the world had never seen.

Above all, the government cares for its people. 

China has remained the world's largest manufacturer for many years. In 2025, Chinese manufacturing output grew by 6.8%; US manufacturing grew by about 1%.

So, I cannot say America “produces nothing”. It plainly does, and still on a huge scale. But the direction of travel is what interests me.

For decades, America allowed large parts of its industrial ecosystem to migrate overseas, while China methodically accumulated one industrial capability after another. And now Washington suddenly discovers “industrial policy”.

Now it talks about reshoring. It now worries about shipbuilding, about about semiconductors and about about batteries, rare earths, pharmaceuticals, machine tools and supply-chain security.

Why?

Because at long last it has realised that you cannot run an economy forever on financial engineering, asset inflation, consumption and somebody else’s factories.

The Richest Country — With What Kind of Richness?
The phrase “richest country in the world” also deserves examination.

Rich for whom?

America undoubtedly contains enormous private wealth. But it also contains enormous insecurity.

The Federal Reserve reported this year that 37% of American adults could not meet an unexpected US$400 expense entirely from cash, savings or a credit card paid off immediately. Thirty percent said they could not cover three months of expenses by any means if their main income disappeared.

That is not destitution, but neither is it the picture normally conjured up by the phrase “the richest country in the world”.

Look at homelessness. According to the US government itself, 745,652 people were homeless on a single night in January 2025, including more than 266,000 living unsheltered.

Anyone who has walked through parts of Los Angeles, San Francisco and several other American cities does not need a lecture from an economist to understand that something is seriously wrong.

And now the US federal debt has passed forty trillion dollars, and borrowing costs are rising.

Yet we continue to hear the same majestic descriptions: “The wealthiest country.” “The largest economy.” “The indispensable nation.”

But we should in fact ask: indispensable to whom, and for how long?

What Is the World's Most Important Economy?
To me, an even more interesting question is not: Which is the largest economy? It is: Which is now the most important economy in the world?

If China suddenly stopped manufacturing tomorrow, how many global supply chains would continue functioning normally?

How many factories elsewhere would discover that some component, chemical, machine, magnet, battery, solar module, electronic part or industrial input was no longer arriving?

How many countries would find their construction projects delayed?

How many manufacturers would suddenly discover how much of their supposed “domestic production” depended upon Chinese inputs?

That, to me, is economic importance.

China has become deeply embedded in the physical functioning of the world economy.

Yes, America still remains important in finance, technology, capital markets, aerospace, software and many advanced scientific fields.

But increasingly China sits at the centre of the industrial economy. 

And Then There Is Military Power

The same lazy ranking occurs with military power.

We are repeatedly told that America has “the most powerful military in the world”.

Again I ask: Measured how? Number of aircraft carriers? Military expenditure? Foreign bases? Nuclear warheads? Aircraft? Satellites?

If warfare were simply a matter of adding equipment into an Excel spreadsheet, perhaps we could settle wars before firing a shot.

But modern warfare does not work that way.

What matters is the whole system: surveillance, satellites, drones, missiles, electronic warfare, cyber capability, industrial replenishment, logistics, command networks, air defence, anti-ship weapons and — above all — the ability to replace what gets destroyed.

China understands this.

It is not simply trying to build the same number of aircraft carriers as America.

Its military development has concentrated heavily on what strategists call anti-access and area denial — making it extraordinarily dangerous for an opposing navy or air force to operate near China. Even the US Department of Defense openly acknowledges the scale and speed with which China has developed these capabilities.

That is why counting aircraft carriers tells only a small part of the story. Aircraft carriers themselves are hardly floating pieces of divine machinery.

Look at the recent saga of the USS Abraham Lincoln. 

The mighty symbol of American naval power spent an extraordinary period continuously at sea. Reports emerged of food shortages, broken toilets, plumbing problems, water issues and serious stress among the crew. After 286 days of deployment, some 5,000 sailors finally reached Thailand for respite in early September.

Those toilet stories particularly amused me.

Here is supposedly one of the most formidable weapons ever created by mankind — nuclear-powered, carrying sophisticated combat aircraft and billions of dollars of equipment — and sailors are circulating videos of toilets they cannot properly use.

Perhaps warfare has indeed entered a new technological age: stealth fighters outside; clogged toilets inside!

Of course, broken toilets do not prove that an aircraft carrier cannot fight but they do provide a useful antidote to the almost religious awe with which American military hardware is sometimes discussed.

Machines are machines; ships are ships; and sailors are human beings!

Would the United States Defeat China?

I constantly hear people declare confidently that America would defeat China in a war.

Really?

A war where?

Off California?

Or off China’s own coast?

Those are two completely different questions.

A conflict fought thousands of kilometres from the continental United States but close to China’s industrial base, missile forces and logistical infrastructure would be nothing like Iraq, Afghanistan or Libya.

I do not pretend to be a military strategist, but I certainly would not accept the silly proposition that because America spends more money on defence and owns more carriers, victory over China must therefore follow. Indeed, my own view is stronger than that.

I do not believe any outside force today can confidently expect to defeat China in a major conventional war fought on China's doorstep.

Anyone advocating a preventive war against China on the assumption that it would be quick, clean and victorious is, in my opinion, a "Pete Hegseth". He may discover otherwise only after hundreds of thousands — perhaps millions — of people have paid for his stupidity.

Trump — China's Windfall

I have said before that China could hardly have asked for a more helpful adversary.

Trump seems determined to accelerate many of the very trends that are weakening America’s international standing. He quarrels with allies. He threatens friends. He imposes tariffs and then modifies them.

He announces one thing today and another tomorrow. He treats diplomacy as though he were bargaining over the rent of a Manhattan shoplot.

And whenever markets force a retreat, somebody invents another explanation for why the retreat was actually a magnificent victory. Hence the wonderful acronym: TACO - Trump Always Chickens Out. 

Crude?

Certainly. But that's the real Trump.

Meanwhile, Xi Jinping behaves almost exactly in the opposite manner.

Whether one likes Xi or not is irrelevant. Just watch his demeanour - Measured, Controlled, Expressionless when necessary, No shouting, Rarely boasting about himself. Rarely behaving as though every international negotiation were an episode of reality television.

The contrast fascinates me. Trump throws tantrums, Xi waits. Trump brags, Xi watches.

Trump wants everybody to know he is the strongest man in the room; Xi seems perfectly content to allow time to demonstrate where the power lies.

That must be infuriating for Trump and we are about to see the contrast again.

Xi is expected in Washington on 24 September, offering the world another opportunity to observe the two men together.

Whatever agreements emerge from that meeting may matter less, in the longer sweep of history, than what the meeting symbolises.

One leader presides over a country desperately trying to preserve a primacy it has enjoyed for generations. The other presides over a country that does not need to announce every morning that it is rising. It simply continues building.

So Am I Paranoid?
Perhaps my friend is right. Perhaps I am paranoid whenever I see the phrase “the world’s second-largest economy”. Perhaps I read too much into it.

But words reveal assumptions.

For decades, much of the Western commentariat — and, unfortunately, many Asians educated to think through Western eyes — has treated American primacy almost as a natural law.

America is No. 1. Therefore, everybody else must be No. 2, No. 3 or No. 4.

I no longer accept that framework. The world has changed. Economic power is changing. Industrial power has changed dramatically. Technological power is becoming much more widely distributed. Military assumptions that looked reasonable twenty years ago are increasingly questionable.

And the centre of gravity of the world economy is moving eastward whether Washington likes it or not.

The American political establishment — Democrats and Republicans alike — may rage against China and Congress may pass resolution after resolution. Think tanks may devise more sanctions and politicians may scream about “containing China”. Military hawks may even fantasise about bombing it before it becomes too powerful.

But they cannot legislate history backwards. Nor can Donald Trump tariff the twentieth century back into existence.

China has already crossed too many thresholds.

It is too large, too industrially complete, too technologically capable and too deeply connected with the rest of the world simply to be pushed back into the subordinate position that Washington would prefer.

So, the next time someone introduces China as: "the world's second largest economy...", I shall probably still get irritated. These people are still wearing the twentieth-century American spectacles. 

End

America’s Death Spiral

 

When Americans entered the polling booths to elect their 47th President in November 2024, they had only a Hobson’s choice between two mainstream candidates — Donald Trump and Kamala Harris. One was a crook; the other a dumb-dumb.

The US as a country was no longer capable of thinking, which is hardly surprising. Trump ushered in the decline when he was the 45th President, and the semi-demented Joe Biden sealed the country’s path. And the return of Trump was another godsend for China.

Each time China was mentioned by the Western and pro-Western press, it was invariably described in terms of the “Chinese Communist Party”, rather than simply the Chinese government. We all know the sinister intent, not to mention the ignorance. (The correct name is the “Communist Party of China”, if you want to be exact.)

I am always contemptuous of politicians with serious character flaws. Trump is the personification of this.

In 1994, when Trump was struggling with the Riverside South development in Manhattan, a consortium of Hong Kong businessmen led by Henry Cheng and Vincent Lo came to the rescue. They acquired a defaulted mortgage of about US$250 million for roughly US$90 million and provided the financing that kept the project alive. Trump even retained a 30 per cent interest in the profits. It was, by any reasonable description, a rescue at a particularly difficult time in his business career.

He was given extraordinary treatment when he visited Beijing in November 2017, including a reception at the Forbidden City. Within the following year, the United States and China were in a full-blown trade war. On 6 July 2018, Washington imposed 25 per cent tariffs on US$34 billion of Chinese imports.

Gratitude is totally absent from Trump’s worldview. Those who have read the book written about him by his niece will also tell you how unkind he could be even to his own folks.

Then came Huawei.

On 1 December 2018, the Canadian toyboy Prime Minister Justin Trudeau arrested Huawei princess Meng Wanzhou in Vancouver at the request of the US. We all knew the three-year detention was totally uncalled for. Her release was perhaps the only good thing Biden had done in his whole presidency!

The last eight years taught China one thing about the Americans and the Whites in general: Never trust the US leaders, regardless of political affiliation. China cannot count on the Whites and the pseudo-Whites.

Then came 2 April 2025 — “Liberation Day” — when Trump announced his sweeping global tariff decrees.

But too bad: China was already ready. While the lesser countries were crawling to ask for favouritism, China totally neutralised Trump’s foolishness.

Even his own court ruled him wrong.

Yet the tariff gun has hardly been put away.

Trump would undermine — for his own ego and personal interests — the enormous strategic advantages that America spent three-quarters of a century building: trusted alliances, an open economy, world-class universities, the attraction of global talent, confidence in the dollar, and the belief that when Washington gives its word, that word means something.

Trump seems determined to spend that inheritance.

While Sleepy Joe and his eunuchs — Antony Blinken, Katherine Tai, Nicholas Burns, etc. — were still coming up with all sorts of sanctions to try to retard China, Trump was mobilising a bunch of nincompoops — a harebrained chap called Pete Hegseth, an economic truth-distortionist called Auntie Scott Bessent, fellow Epstein-buddy Howard Lutnick, and all — to strengthen and glorify his supreme-ness. Meanwhile, China was transforming its entire landscape in economics, the military, science and technology, and what-have-you, to surpass every nation on earth.

Yet the Western and the pro-Western press keep telling the ignorant world that China is facing unprecedented woes in the real-estate sector, youth unemployment, etc., etc.

They simply do not — or refuse to — understand that China is correcting these issues in the most fundamental, albeit difficult, way.

Again, I go back to Trump’s character flaws to celebrate.

Look at Canada, one of America’s closest friends and trading partners. As recently as 21 August 2026, Washington imposed new 50 per cent tariffs on some US$20 billion of Canadian goods after negotiations collapsed. Prime Minister Mark Carney suspended the talks and announced dollar-for-dollar retaliation.

Is this how a great power treats its closest neighbours? Trump seems to confuse fear with respect, and submission with friendship.

Notwithstanding all this, the President of the European Commission, Ursula von der Leyen, is still trying hard to suck up to Trump, although it is very obvious that he DOESN’T like this blonde! Ditto Sanae Takaichi of Japan.

But in global politics, there will always be clowns like them and minions like Ferdinand Marcos Jr and a couple of others.

Venezuela
On 3 January 2026, US forces entered Venezuela, captured Nicolás Maduro and his wife, and carried them to the United States. Maduro is now being held in New York awaiting a trial scheduled for June 2027.

I have no fondness for Maduro. Anyone who wears his type of moustache is usually one who carries a complex. But here is the larger question: Can we keep allowing the US to enter another sovereign country, seize its leader and carry him to the US for trial?

Military power can remove a man. It cannot by itself create legitimacy, prosperity or stable government. America should have learnt that lesson from Iraq and Afghanistan.

Apparently not.

And Now Iran
The same hubris is playing out on a vastly more dangerous scale in Iran.

Ayatollah Ali Khamenei was killed on 28 February 2026 in the opening US-Israeli strikes. Washington evidently hoped that decapitating Iran’s leadership and smashing its military infrastructure would produce either capitulation or political collapse.

Nearly six months later, where is the triumph?

Iran has been badly damaged. Thousands have died. Its economy is under enormous pressure. But the war continues, the Strait of Hormuz remains severely disrupted, and Tehran retains enough missile and drone capability to keep the region dangerous. It is a costly standoff rather than the quick strategic victory Trump might have imagined.

It is not that Iran is “winning”.

The much more important point is that America is expending enormous military, political and economic resources simply to prevent itself from losing control of the situation.

The United States is now racing to rebuild its missile inventories. American high-end munitions stocks have been severely strained by Ukraine, the Middle East and now Iran.

But where will it get the rare-earth elements?

Despite all the sanctions, China continues to buy the overwhelming majority of Iran’s exported oil. Reuters puts its share at around 80 per cent. China simply doesn’t give two hoots about Trump anymore.

There are also growing signs of deeper Chinese-Iranian technological and military links. US officials say China’s SMIC supplied chipmaking equipment and training to Iran’s military. Reuters has reported prospective Chinese missile supplies to Iran, although Beijing has denied some of these reports.

The point is not that China controls the Middle Eastern battlefield. The point is that the US can no longer simply issue an order and assume that the rest of the world will fall into line.

The US$40-Trillion Debt
Meanwhile, back home, the numbers are becoming frightening.
The US national debt has now crossed US$40 trillion. Long-term Treasury yields have risen sharply; on 21 August, the 30-year yield ended at about 5.28 per cent, around its highest level in nearly two decades.

Auntie Bessent can explain, reassure and pontificate as much as he likes.

But he cannot talk away US$40 trillion.

Nor can America permanently borrow its way to prosperity, cut taxes, fight expensive wars, maintain military forces across the world, subsidise favoured industries and somehow expect the arithmetic never to arrive.

Wall Street, of course, remains extraordinarily good at keeping the music playing. AI enthusiasm has sent valuations skyward.

But musical chairs is an interesting game.

It works wonderfully — until the music stops.

And China?

Here, too, I think much Western commentary remains stuck in yesterday.

First, let us settle one argument.

If GDP is measured at market exchange rates, the US remains the world’s largest economy. But that is merely of statistical interest. You go to America and straightaway you can conclude that it is nonsense.

GDP has to be measured by purchasing power parity — unless your country is still very dependent on the US dollar — and China is No. 1. Period. World Bank data put China’s 2025 GDP at roughly US$41.3 trillion in PPP terms, against about US$30.8 trillion for the US.

So simply shouting “China is still No. 2” without specifying the measure is increasingly meaningless.

China certainly has problems, but its leaders are fully aware of them and fully committed to solving them. Anyone who cannot see China’s industrial power is looking in the rear-view mirror.

The New Technology Juggernaut
My own shorthand has always been this: America and the West have, in modern history, been superb at 0-to-1 innovation — creating something radically new. But China has become extraordinarily good at 2-to-10 — engineering it, improving it, scaling it, driving down its cost and manufacturing it by the millions.

And in the real economy, 2-to-10 matters more.

Consider electric vehicles and batteries alone. In 2025, China produced roughly 16 million electric cars, close to three-quarters of global output. It accounted for more than 80 per cent of global battery-cell production, around 85 per cent of cathode active material and more than 90 per cent of anode active material.

That is not propaganda.

That is industrial capacity.

In robotics, an extraordinary pattern is emerging. Chinese companies increasingly demonstrate an ability to produce breakthroughs and industrialise them cheaply and rapidly. Their “robot dogs” will knock out the US ones with both eyes closed.

In semiconductors and AI, yes, the US does possess some technological advantages, but we should describe them correctly.

The world’s dominant advanced-semiconductor foundry is not American. It is TSMC of Taiwan, which accounts for more than 70 per cent of global foundry revenue. America’s strength lies elsewhere in the semiconductor ecosystem — in chip design, AI accelerators, software and intellectual property, together with crucial allied capabilities in Taiwan, Japan, South Korea and Europe.

How long that advantage lasts is another question.

And AI contains another delicious irony.

America’s greatest advantage has always been its ability to attract the world’s cleverest people. Chinese talent forms a remarkable part of that strength. Data on leading AI researchers show just how deeply the American AI establishment depends upon foreign — and particularly Chinese-trained — scientists. MacroPolo’s latest talent tracking finds that 38 per cent of the researchers it studied received their undergraduate education in China, with a very large proportion subsequently working in the US.

My oft-used description — “Chinese Chinese versus American Chinese” — is not entirely without basis.

The strategic lesson for America should be obvious: if you make talented foreigners feel unwelcome, you may eventually send some of your greatest intellectual assets straight into the arms of your competitors.

And the Military Balance?
China has been flight-testing at least two new-generation tailless combat aircraft — the J-36 and J-50 — since late 2024. These are real and impressive.

The Pentagon claims that its new “Trump” stealth fighter — the F-47 — will fly in 2028.

Let’s wait and see.

The battleships are languishing everywhere. One was even left adrift after it lost power. All these speak volumes. America is NO longer enormously powerful.

China is MORE than an equal.

The seas within the 2nd Island Chain will become the graveyards of US and allied fleets if a war were to break out there.

Xi Is Coming to Town
Xi Jinping is expected at the White House on 24 September 2026. He will be in town for only one day.

And you can bet on this: Bessent and Lutnick will certainly come up with some new sanctions the moment Xi’s plane takes to the skies.

But does China care?

The relationship has changed.

Xi comes as the leader of the only country with the industrial scale, technological depth, military resources and economic weight capable of toppling the US across every dimension simultaneously.

That is the reality Trump should understand.

Instead, he still seems to believe that every international relationship is a Manhattan property negotiation: frighten the other fellow, threaten to walk away, squeeze him for the last dollar and announce victory.

At the end of the day, Trump is actually a weak President. The acronym TACO — Trump Always Chickens Out — is most apt for him.

And that is why I continue to regard Donald Trump as something of a godsend for China.

Conclusion
The Statue of Liberty no longer shines as convincingly as the symbol of freedom and democracy it once was. The model of predatory economics that the West has spent decades preaching to the rest of the world is also coming under increasingly serious question.

There is, of course, another model emerging from China. Unfortunately, it is not one that can easily be replicated elsewhere. China’s system is the product of its own history, culture, institutions and extraordinary capacity for long-term planning.

But the larger lesson is much simpler.

The problem is self-denial. Too many Western and pro-Western leaders remain blind to the most basic principle of government: leaders must work for the people. Whatever one may think of China’s political system, its leaders understand that legitimacy ultimately depends on delivering for their people — building infrastructure, raising living standards, reducing poverty, strengthening the country and planning for generations rather than for the next election cycle.

Certainly not leaders like Trump.

Perhaps the greatest consequence of the changing world order is that countries, large and small, are discovering that they no longer have to kowtow to an international tyrant. They need not accept lectures, threats, sanctions and bullying simply because these come from a country that once regarded itself as the indispensable nation.

Every country has the right to safeguard its own interests, choose its own path and take pride in its sovereign dignity.

I am afraid that, under Trump, the US is suffering from a terminal illness. Power without wisdom, leadership without responsibility, and arrogance without self-reflection can only accelerate the spiral.

And that, to me, is America’s death spiral.

End

 

P/S
Some friends have been asking whether I have lost steam with my blog, as they have not seen any new articles from me for several weeks.

Far from it. I have simply been totally consumed by the preparation of two books.

The first is Following the Chinese Footprints: A Journey through the Chinese Diasporas Across Five Continents. It is now in PDF format and available on request.

The second is More Than Friends and Acquaintances: Remarkable People I Have Met Along the Way. This will come in two versions: a digital edition, which will be available free on request, and a printed edition, for which I will charge only at cost.

So, no, I have not lost steam. I have merely been spending it elsewhere!

Unplug Our Eyes from the Sand

 

I have almost developed a form of news-fatigue syndrome!

A member of one of my WhatsApp chat groups religiously posts a daily update on the Iran War. I do not know where he gets these updates from. I simply skip them each time they appear. I also doubt that he himself reads these daily updates!

But people love to post, as if to register their presence — rather like the “Good Morning” greetings you so often receive.

The truth is, how many of us really read about the Iran War now? Or the Ukraine War? Or the aftermath in Venezuela?

Perhaps the next headline we are waiting for will be the US invasion of Cuba.

Trump loves to generate headlines. But who believes him anymore?

But What Keeps Me Writing So Very Often?
Answer: The silliness of many Ang-mohs, pseudo-Ang-mohs and wannabe Ang-mohs! 

Just a day or two before the expiry of the temporary 10% global tariff, the US announced a new measure: tariffs of 10% to 12.5% on imports from about 60 countries/economies. The stated justification is that these countries — of all reasons — have inadequately enforced prohibitions on goods produced with forced labour. (Much of the Liberation Day regime, as we all know, had been struck down by the Supreme Court.)

And Singapore is slapped with a rate of 12.5% — even higher than that handed down to Malaysia, at 10%. 

However, these new tariffs do not simply erase every existing US tariff. They are generally imposed on top of the normal Most-Favoured-Nation/customs duties, while various products and existing sectoral measures have exemptions or separate treatment. India, for example, gets a 10% rate, but roughly 45% of its exports — including specified categories such as generic pharmaceuticals and smartphones — are exempt from this particular new levy.

The administration is shifting towards established trade statutes such as Section 301, which are legally harder to overturn.

The other more pertinent cases: China, 12.5%; India, 10% (total, including MFN); Japan, 12.5% (total, including MFN); South Korea, 10% (total, including MFN); Canada, 10%; and Mexico, 10%.

Just a ballpark figure for China: the cumulative tariff on an individual product can readily be 20–40%+, depending on its tariff classification.

Is China concerned? Of course. But is it lethal? Certainly not. And I bet you, Trump will yield. He is just profiling. The US needs all those Chinese goods. Period.

And is anybody reading this news? I bet hardly anyone.

And the New Sanctions from the US and the EU
In response to the EU’s latest Russian sanctions, which included 14 Chinese/Hong Kong companies, China struck back immediately. It placed 14 European entities on its export-control list. Several of these entities are among the most significant in Europe. The Chinese ones, on the other hand, are peanuts in size.

(Among the European companies affected are Germany's Rheinmetall and Poland's Vigo Photonics, alongside firms in France, Italy and the Czech Republic. These are industrial giants.)

This is actually the second such retaliation against Europe this year. In April, China put seven EU entities under similar export restrictions following the EU's 20th Russia-sanctions package.

After the US expanded its list of Chinese companies alleged to have links to China's military in June, China responded by imposing trade/export restrictions on American companies, particularly firms involved in defence, aerospace and strategic materials. Ten US companies were subjected to export controls.

Beijing now has an increasingly elaborate anti-sanctions and anti-extraterritoriality legal framework that allows it to punish foreign companies for complying with foreign sanctions that China considers illegitimate.

What is particularly interesting is China's choice of weapon. Rather than merely answering tariffs with tariffs, Beijing is increasingly using its leverage over rare earths, critical minerals, magnets and other dual-use supply chains. For certain Western defence and high-tech companies, losing access to these inputs can hurt considerably more than an additional 10–20% tariff.

These Ang-mohs are very bodoh. They are living in a delusional world!

The Silliness Extends Beyond the Ang-mohs

The Philippines…
Wang Yi, in his meeting with Philippine Foreign Affairs Secretary Maria Theresa Lazaro on July 22 in Manila, on the sidelines of the ASEAN meetings, was most pointed. He warned that China–Philippines relations had reached a “crossroads” and that Manila needed to make the “correct and rational choice.” (You could also see Lazaro’s attempt to look taller than Wang – by tilting her nose skywards in a one-for-the-album photo-shoot session!)

The immediate background was the latest “wayang” staged by the Philippines near Ren’ai Shoal (仁爱礁, Second Thomas Shoal), where Philippine vessels had deliberately rammed a Chinese Coast Guard vessel. The Philippines should henceforth decide whether it wants cooperation and stable relations with China, or continued confrontation.

Incidentally, Marco Rubio was also in town. Did anyone notice his presence?  

Japan…
Instead of living peacefully with a heavyweight neighbour, Sanae Takaichi is determined to revive militarism in Japan and is trying to enlist the Philippines and Taiwan to serve her cause. China and Russia are not going to let Japan have it that way.

There has been a noticeable escalation in Japan's military friction with these two neighbours.

The most recent incident occurred in July, around Okinotori in the western Pacific. A Chinese naval group operating together with a Russian frigate entered waters that Japan regards as its exclusive economic zone (EEZ) and conducted a live-fire exercise. Japan lodged a diplomatic protest, of course, China just gave Japan its middle finger.

Okinotori, which is about 1,700 km south of Tokyo, is essentially a rock rather than an island capable of generating an EEZ. And an EEZ is not sovereign territorial water.

And a few weeks earlier, China and Russia also conducted a major joint strategic air patrol around Japan and Korea with bombers and maritime-patrol aircraft. Chinese J-16 and Russian Su-35 fighters accompanied parts of the formation. They operated through the Sea of Japan and East China Sea. Takaichi should take note. This was their 11th joint strategic air patrol and no longer an occasional symbolic exercise.

The relationship had already become considerably more dangerous after the December 2025 encounter involving the Chinese carrier Liaoning. Chinese J-15 fighters twice directed fire-control radar at Japanese F-15s which were monitoring the carrier's operations.

China and Russia appear increasingly willing to demonstrate that Japan cannot treat China, Russia and North Korea as three completely separate security problems. Despite Trump’s abhorrence of geishas, Takaichi still wants to sing and dance her way into Trump’s heart.

And Indonesia…
I posted two articles on Indonesia on June 2 but decided to pull them shortly afterwards. They are: Is Indonesia Turning Against China (https://yubooklim.blogspot.com/2026/06/is-indonesia-turning-against-china.html) and China and Indonesia: The Sweet and Sour Relationship (https://yubooklim.blogspot.com/2026/06/china-and-indonesia-sweet-and-sour.html?m=1). However, having watched further developments unfold, I decided to repost them.

When it was disclosed in February that Indonesia was agreeing to US aircraft overflying Indonesia — which meant that US aircraft operating between bases such as Diego Garcia, Guam and facilities in Australia and the Philippines could move rapidly between the Indian and Pacific Ocean theatres — we already knew that Indonesia had begun to ingratiate itself with the US administration. The export controls on commodities and the nickel policy, aimed principally at China, therefore came as no surprise.

Indonesia's Finance Minister, Purbaya Yudhi Sadewa, on June 25, 2026, personally conducted a surprise inspection at a Chinese-owned steel company in East Jakarta, claiming that there was a large discrepancy between the apparent scale of the company's operations and the tax it reported.

Purbaya said his ministry had identified about 40 Chinese steel companies suspected of using similar methods. His language was unusually pointed. He said his ministry had specialists familiar with the ways “Chinese companies” allegedly misled the government. Earlier, he had stressed that the companies under investigation were Chinese, saying in effect: they are all from China, not mixed companies.

Yes, by all means go after tax evaders, but do allow the relevant authorities to follow due process. By naming and shaming China, isn’t this a blatant anti-China act? And his arrogance is totally un-Asian.

"Looking Up to Whites” Mindset
I often get “discriminated” against by our own kind in the way I am treated. Two incidents remain fresh in my mind.

The first was when I was entering the Business Class cabin of a Singapore Airlines plane, only to see a stewardess eagerly rushing forward to serve an Ang-moh despite a yellow man also being there.

The second was at Hong Kong airport. While my wife and I were waiting to be served at the priority line, the ground crew seemed to think we were invisible; he welcomed an Ang-moh couple first. I blasted him and actually wrote to SIA to complain. I remember they sent me some gift vouchers to appease me!

Takaichi is blatantly telling China that Japan did not lose World War II to China. It lost to the US. And they will always kowtow to the conqueror.

One of the first foreign visits made by Marcos Jr. was to China. But his American baggage was too heavy; he soon reversed gear and aligned himself with the former colonial master.

Prabowo also rushed to attend China’s September 2024 military parade, even though he was facing some unrest in his own country. But just observe how his eyes seemed to be begging Trump to pay some attention to him when they were in Egypt, where Trump was holding his Peace Summit in October 2025.

Trump did not disappoint him and greeted him warmly, publicly calling him a “tough man.” That must have sent him sky-high immediately. That must have done wonders for his self-esteem.  

The problem is also China’s. It does not believe in acting like a tough guy, even in its confrontations with the Filipinos over some of the South China Sea islands. Whip the big cane and the Filipinos will come abegging. This was how Rodrigo Duterte turned the Filipinos around during his rule.

I hear that many of the resource-rich countries in Africa are now also trying to adopt the Indonesian approach in dealing with China.

If you are really worth your salt, you process your resources all the way into finished products. But these countries cannot go beyond digging, yet they believe in resource nationalism. Without technology and markets, what good are your minerals?

Many mine owners owe their existence to financing even before the deposits are fully determined. Many go to banks to borrow to support fixed and working capital — and even their private jets and yachts. Once the sales contracts are cancelled, the banks will go after them, just like the farmers in the US. That’s when the politicians will realise the folly they have created.

Yes, to the leaders of these countries: do learn some ABCs of international economics.

Time to Crane One’s Neck
Trump is a godsend to China. US antics have allowed China to stage “vertical take-offs” in science and technology especially during the last two years. Yes, the economy has not been that great, but its resilience is mind-boggling.

Despite its handicap in hardware, China is neck-and-neck with the US in AI. There are simply too many of the likes of Liang Wenfeng, Wang Chuanfu, Zeng Yuqun and Yang Zhilin in China, not to mention the recent Fields Medallists Wang Hong and Yu Deng. Without the Chinese in Google, Meta and those other IT giants in the West, they will soon fade.

Sooner or later, the US will bite the dust once China has overcome its remaining handicaps — which it definitely will. China is simply too formidable to compete with in terms of cheaper energy alternatives and their availability, which will be a determining factor in the AI race.  

I personally do not quite like the South China Morning Post, for I think many of the journalists there are outright anti-China. However, when it comes to science and technology reporting, they are always fast and accurate. You can follow all of China’s advances in weaponry there.

A fact has simply emerged: the Western Pacific will become the graveyard of US warships if they come to Taiwan’s defence should China decide on forced unification. I believe unification is inevitable; but it will not be through a direct war.

Again, the huge pool of talent in the other branches of science and technology will propel China towards becoming the standard-setter in many things to come.

And ultimately, it is their leaders who make all this happen. They are constantly adapting — in spite of the fear many perceive, thanks to the misconceptions that have been laid out by the West and pro-Western media.

A simple visit to China will destroy all these misconceptions. And China has now opened its doors for everyone to witness history.

Ditto the US flip-flops on the destruction of Iran. It simply fears China and Russia’s intervention, especially when its munitions are running so low.

In short, the US’s decline is inevitable. (Many will certainly disagree with me on this.)

And China is starting a new universe — fortunately or unfortunately.

End

 

Hypes and Suckers

 

Pardon me; I often make sweeping statements and draw sweeping conclusions!

Tupai King

I read that, because of bumper harvests and reduced imports from China, durian prices had plunged to less than RM10 a kilo. There were also many TikTok clips talking about the disaster facing durian growers.

I love durian and thought I still had time to enjoy the season when I flew back from Melbourne last Friday. I lost no time in driving to visit my regular vendor, Donald, at his stall between Petaling Jaya’s SS2 and Section 17.

Donald says his durians come from his own farm, and his Musang King is usually great. Because I am marginally diabetic, Saw Hwa (my wife) allows me only two seeds at a time. I therefore always ask Donald for the best he can offer.

He packed the three remaining Raja Kunyits on his shelf for me and said he would charge me only RM42 a kilo. I thought the price was stiff, but I did not feel good bargaining with him.

He also offered me Tupai King, saying it was the best durian one could ever taste. The regular price, he said, was about RM100 a kilo; he offered it to me at RM80. And the usual sucker in me could not resist his persuasion. I promptly bought one.

They were vacuum-packed, and I kept them in the freezer.

Upon my return from Phnom Penh on Thursday, I had the box of Tupai King thawed. I tasted it.

I was furious with Donald’s recommendation. It was one of the worst durians I had ever tasted. The seeds were big and the taste rather flat.

I heard that Tupai King is a Penang variety. It has apparently been around for several years but has only more recently become widely sought after.

Then I remembered that Donald had earlier also recommended that I try Black Thorn. Both Saw Hwa and I thought it was nothing great either. Same thing: the seeds were big and the taste so-so.

I telephoned him to complain. He was a little sheepish.

Maybe he himself had been caught up in what I call the “accomplice syndrome.” You don’t really believe the claim, but for fear of being branded as someone with “no taste,” you go along with it — as many of us do from time to time.

To me, Tupai King and Black Thorn are like emperors who do not realise they have no clothes on!

But maybe it was just Donald’s fruits that did not taste right. Perhaps other Tupai Kings and Black Thorns are not like that.

Should I give these two varieties the benefit of the doubt?

Char-wong

In restaurants, I was often offered char-wong to start with. Char-wong simply means “King of Tea” in Cantonese. You have Pu-er, Oolong, Longjing, etc. But is there really a variety called char-wong? Where is it grown? Come on! Its advocates must think we are idiots.

This reminds me also of Pu-er.

Some connoisseurs claim that they can distinguish Pu-er plucked from trees that are 300 or even 400 years old. I think much of it is BS. I read somewhere about a so-called expert who made a terrible call and was caught out.

Yet many people will pay thousands — sometimes tens of thousands of dollars a kati — for such “vintages.”

Many may simply be drinking fermented rubbish while convincing themselves that it is good for their health!

And next... Wines

And remember a certain Rudy Kurniawan, an Indonesian who became perhaps the world’s most notorious wine counterfeiter?

Kurniawan entered the elite American wine-collecting world in the 2000s and became known as “Dr. Conti” because of his apparent expertise in Domaine de la Romanée-Conti. He had an extraordinary palate and an ability to blend lesser wines so that they resembled extremely rare and expensive vintages.

His operation was ingenious. He obtained genuine empty bottles of prestigious wines and refilled them with blends of cheaper wines, then used counterfeit labels, corks and other materials to make them appear authentic. Some were sold for enormous sums to wealthy collectors.

When the FBI searched his California home in 2012, agents found what amounted to a wine-counterfeiting workshop — old bottles, corks, labels and blending formulas.

One mistake helped expose him. He offered bottles purporting to be Domaine Ponsot Clos Saint-Denis from 1945 and other early vintages.

Laurent Ponsot (the proprietor), pointed out that his domaine did not begin producing that particular wine until 1982!

Kurniawan was convicted in the US in December 2013 and later sentenced to 10 years in prison for selling millions of dollars’ worth of counterfeit wine and related fraud. He was eventually released and deported to Indonesia in 2021.

After returning to Asia, Kurniawan reportedly began demonstrating his blending skills openly at private tastings, where his imitation blends were compared with genuine prestigious wines — and, reportedly, were sometimes even preferred by the guests.

All these examples expose something interesting about human psychology: how reputation, expectation and group opinion can influence what even supposedly expert palates believe they are tasting.

Perhaps nobody wants to be the fool who admits: “I can’t taste the difference.”

And many of us, from time to time, are just suckers!

End

 

A Walk Down Memory Lane – Phnom Penh

The organisation with which I am associated recently held its conference in Phnom Penh. We had intended to hold it in Siem Reap last year; unfortunately, the border skirmishes with Thailand prompted us to postpone the event and move it to Phnom Penh this year.

My MH flight landed at its new airport – Techo International Airport (KTI). It opened only last year. Apparently built with substantial Chinese involvement, it is a beautiful, massive airport, though traffic was light.

There was some nostalgia about the visit.

The Nostalgia
I had visited Phnom Penh before; it was in 1996. I couldn’t recall any familiar sight at all.

However, two incidents remained etched in my mind.

One of the richest men in the country then was Teng Boonma. He was a Thai-born Cambodian businessman and headed the Thai Boon Roong business group. He was building the InterContinental Phnom Penh then, the country’s premier luxury hotel.

There was an interesting incident involving him. Teng pulled out a pistol and shot one of an aircraft’s tyres when he became angry after Royal Air Cambodge apparently failed to deliver his luggage on a flight from Hong Kong. Contemporary reporting sometimes described him as the owner of the airline; however, he was not. He died in 2016 at the age of 75. The episode became emblematic of the extraordinary power enjoyed by Cambodia’s leading tycoons in that period.

He wanted to have a casino in the hotel and invited one of Genting’s children to start one for him. I was asked to evaluate its feasibility.

I remember him personally showing me around. What was memorable was the constant presence of his personal security guards armed with machine guns – before and behind us. He even took me to his house and introduced his beautiful daughter to me.

We did not take up the offer.

The second incident was even more “memorable”.

I was brought to visit the Tuol Sleng Genocide Museum. It was known by its Khmer Rouge designation, S-21 (Security Prison 21), and had originally been a secondary school. After the Khmer Rouge took Phnom Penh in 1975, the school was converted into a secret detention, interrogation and torture centre. Around 15,000 people are estimated to have been imprisoned there, with only a tiny number surviving.

Tuol Sleng (S-21) was principally a prison and torture/interrogation centre. Prisoners were subsequently transported to Choeung Ek, about 15 kilometres outside Phnom Penh, where many were executed and buried in mass graves. Choeung Ek is the site most commonly called “the Killing Fields”. In 2025, Tuol Sleng, Choeung Ek and the former M-13 prison were together inscribed on UNESCO’s World Heritage List as the Cambodian Memorial Sites: From Centres of Repression to Places of Peace and Reflection.

I felt terribly sick after the visit. My stomach refused to work, and I was writhing in my Sofitel hotel room for three days. No amount of Western or Chinese medicine could help. I felt as though I was dying.

The first thing that came to my mind was this: Had I been condemned by the spirits there?

Fortunately, just a day before I was scheduled to fly out, my system returned to its proper state!

Upon reflection, I think it was the fresh salad I had at the Sofitel that created the havoc. Water was not clean at that time, and something I ate must have been contaminated.

After the conference, we organised a short city tour for some of the participants who were visiting Phnom Penh for the first time. Since I had nothing else to do, I decided to join them. S-21 was on the itinerary.

I must say that the feeling this time was completely different. I had seen the exhibits before and was no longer as overwhelmed by the sight, even though the grotesqueness of the Khmer Rouge’s cruelties was something I could never understand. The great perpetrator, Pol Pot, and his cronies had a much easier way of dying.

A Great New Acquaintance
The Hyatt Regency is a beautiful hotel. The rooms are modern and very clean. Labour costs must be pretty low, as the hotel seems to employ far more workers than one normally sees elsewhere. They are very courteous, though.

One Cambodian guest left a strong impression on me.

He is HE Prof Dr Chhem Kieth Rethy, a Senior Minister of the Royal Government of Cambodia. Prof Rethy is a medical doctor, scientist, educator and historian with extensive experience and interests spanning digital technology and AI, nuclear technology, anthropology and philosophy of technology, geopolitics and foreign policy, the social history of Angkor Buddhism, medical ethics and professionalism.

He holds an MD, a PhD in Education and a PhD in History. He has published more than 200 scientific articles and co-authored 25 textbooks.

We invited Prof Rethy as our keynote speaker. Looking at his profile[1], you might wonder whether he is for real.

Yes, he is.

Our pre-conference welcome dinner was supposed to start at 7 pm. Being a Board member of the organisation, I thought I should arrive at the venue early. I got there at about 6:15 and saw a distinguished-looking man already there. I immediately knew that he was the keynote speaker.

True enough, sitting there alone was Prof Rethy. I introduced myself and welcomed him. He was generously engaging. He told me that he had lived in many countries.

We also talked about our heritage. To my pleasant surprise, his forebears were from Quanzhou, like mine. And both of us have grown our roots deeply in the countries with which we are identified – he in Cambodia, and I in Malaysia. He had visited Malaysia many times and knew many VIPs there.

In his speech, I was mesmerised by his intellect and wisdom. He spoke eloquently about Cambodia, which he described as a banyan tree – one that symbolises patience. Civilisation, to him, is a matter of memory. Just like Angkor Wat, it never ceases to exist. Excellence can come from good institutions, but it is through civilisational resilience that life goes on.

He also had a word or two for those chasing AI. He contends that AI by itself is not intelligent. Nor is it wise. AI, as it stands now, has no heart, no conscience and no compassion. “You don’t learn; you copy.” Whereas nuclear weapons are at least state-controlled, AI is in the hands of individuals.

Prof Rethy also talked about his restlessness – and hence his vast knowledge and multitude of achievements in so many fields. He says he is a product of war.

France was Cambodia’s colonial master, but he was not bitter about the French. He said he had learned much from them. And thanks to Latin, he found it easy to master medicine.

There was so much to learn from this great man. We need more leaders like him in this world.

With Prof Rethy, his son and my colleague Michelle

China’s Omnipresence
You all know that China and Cambodia have had a long history of close relations, including during the Pol Pot era. Former Prime Minister Hun Sen is Khmer with Chinese ancestry on his father’s side – Teochew (潮州/潮汕). Of course, not everyone with Chinese ancestry is necessarily pro-China, but Hun Sen definitely is.

You can see Chinese signage everywhere. To my surprise, I even saw some Chinese hawking food near the hotel. They did not even have a cart – just some makeshift planks from which to serve their offerings. They did not look that poor, but their income must have been very meagre. Surely, I thought, they could have found an easier way to earn a living back home. Something is not quite right.

And then there is Xi Jinping Boulevard – on the way to the new airport. The driver proudly pointed it out to me.

Many Cambodians in Phnom Penh can speak Mandarin. I suppose they are learning the language out of necessity.

Regardless, I always harbour this concern at the back of my mind. The present prime minister, though Hun Sen’s son, was educated at West Point. There are already traces in his actions that might have made China nervous. We have seen how quickly relationships can change in the Philippines, and also in Indonesia.

Friendship between countries can be very fragile! 

The road sign reads: Xi Jinping Boulevard

End

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[1] He was a Professor of Radiology in Canada (McGill), Singapore (NUS), Austria (Vienna Medical University) and Japan (Hiroshima, Nagasaki, Fukushima Medical University) for 30 years. He was the Chair of the Radiology and Nuclear Medicine, Department of University of Western Ontario. He was the Director of the Division of Human Health at the International Atomic Energy Agency (IAEA) from 2008 to 2014.

From 2014 to 2019, he was the Executive Director of the Cambodian Development Resource Institute (CDRI), a leading think tank in the Kingdom of Cambodia, in the Top 100 of the University of Pennsylvania’s Global Think Tank ranking. He is the cofounder of the China Studies Center at CDRI. Currently, he is an Honorary Distinguished Fellow at the Asian Vision Institute and a member of the Advisory Board of the International Center for Higher Education Innovation (UNESCO) at the Southern University of Science and Technology in Shenzhen. He is a distinguished visiting professor at the Royal University of Phnom Penh, the Atomic Bomb Disease Institute, Nagasaki, Hiroshima and Fukushima Medical University. He is an international advisor to the China Institute of International Studies in Beijing.

He also serves as an academic advisor to the Kirirom Institute of Technology (KIT). In May 2019, he was appointed Minister Delegate, attached to the Prime Minister. He was seconded to the Ministry of Foreign Affairs and International Cooperation. In August 2020, he was appointed as Secretary of State at the newly created Ministry of Industry, Science, Technology and Innovation, in addition to his position at the Prime Minister’s Office. In these capacities, he oversees the National Institute of

Science, Technology and Innovation (NISTI) and the National Institute of Diplomacy and International Relations (NIDIR). He also serves as a member of the Board of Trustees of the Cambodia Academy of Digital Technology, and he serves on the Leadership Council of the UNSDSN.