Joe Biden pushes exclusion of China

During his extensive tour of Europe, US President Joe Biden is pursuing a clear goal: together with the US, Europe is to counter China's growing influence in the global economy in the future. A new US plan calls for a group of large and influential democracies - known as the "D-10" - to be positioned as a strategic counterweight to China. "In doing so, the rivals US and China risk splitting the global economy into two opposing blocs," says Dr. Heinz-Werner Rapp, founder and director of the FERI Cognitive Finance Institute. The conflict between the two great powers, the USA and China, is thus continuing unchecked under Joe Biden. In the medium term, a new kind of Cold War threatens, with serious consequences for Europe as well.

Struggle for global dominance drives political intensification

According to the FERI Cognitive Finance Institute, the superpower USA fears a threatening dominance of China, especially in relevant future fields such as space travel, communication networks or artificial intelligence. At the same time, China is pursuing an active geopolitics with projects such as the "New Silk Road", which is strongly aimed at international dependencies. "The US now defines China as a strategic problem and is realigning its defense policy accordingly; the official US risk assessment has also recently listed China as a top threat. Both are unmistakable signals of a political tightening," Rapp explains. This means that friendly cooperation between the two countries is virtually out of the question for the foreseeable future.

Biden visit should bring Europe in line

With the new D-10 plan, the US is now trying to involve other countries such as India and Australia, as well as the EU in particular, in its concept of decoupling China. Joe Biden's recent executive order prohibiting US investors from investing in 59 selected Chinese companies in the critical infrastructure sector shows that he is serious. Fittingly, in Europe, the fully negotiated investment agreement with China has been put on hold at short notice, he said. "These events send a clear signal: the US is pushing ahead with its policy of strategic decoupling in order to limit China's influence on the global economy," Rapp said. In the future, he said, there was a threat of a prolonged confrontation with China, which would also entail considerable risks for other countries. Europe, with its strong export orientation, would have to behave very wisely in the future in order not to become the first victim of a split in the global economy. Investors should therefore follow further developments very closely.

Individual statements refer to a comprehensive analysis by the FERI Cognitive Finance Institute, which was published in German under the title "Global Bifurcation oder 'New Cold War'?". The analysis is available for download.