Alicia Garcia Herrero, Natixis Asia Pacific Chief Economist, Bruegel Senior Fellow

Of the 40 world leaders attending today’s virtual White House Summit on Climate Change, the key figure is President Xi Jinping of China. As the world’s largest greenhouse-gas emitter, China will make or break the global quest to achieve climate neutrality by the middle of the century — which will be the only way to limit the global average temperature increase to 1.5 degrees Celsius.

Consequently, President Xi Jinping’s announcement in September 2020 at the United Nations General Assembly of China’s new objective to peak carbon dioxide emissions before…


Alicia Garcia Herrero, Natixis Asia Pacific Chief Economist, Bruegel Senior Fellow

The global economy tumbled into economic crisis over the past year because of the outbreak of Covid-19. As the first country to report the outbreak, China was also the first to feel the trauma, experiencing sharp economic recession in the first half of 2020.

Last year, China’s announced outbound mergers and acquisitions ended lower by nearly one-third in number and more than half in value than in 2019. …


Alicia Garcia Herrero, Natixis Asia Pacific Chief Economist, Bruegel Senior Fellow

After more than seven years and 35 rounds of negotiations, the European Union finally reached a deal with China on the Comprehensive Agreement on Investment (CAI) at the end of 2020.

CAI was intended to replace 25 bilateral investment agreements between EU individual member states and China by offering greater market access within specific sectors. Ultimately, the goal is to reduce uncertainty for European investors in China. CAI also introduces instruments to call for more transparency regarding subsidies and the general behavior of Chinese state-owned enterprises (SOEs).

A major…


Alicia Garcia Herrero, Natixis Asia Pacific Chief Economist, Bruegel Senior Fellow

After a very unpredictable and difficult 2020, this year’s Two Sessions in China — the National People’s Congress (NPC) and the National Committee of the Chinese People’s Political Consultative Conference (CPPCC) — which have started with the traditional government work report has mainly aimed at anchoring expectations for the Chinese economy this year and beyond.

In fact, after having omitted a growth target last year, Premier Li has, somewhat unexpectedly, set a GDP growth target for 2021, other than targets for inflation, fiscal deficit as has always been the…


Alicia Garcia Herrero, Natixis Asia Pacific Chief Economist, Bruegel Senior Fellow

In April 2020, the G20, at the urging of the International Monetary Fund and the World Bank, launched the Debt Service Standstill Initiative (DSSI) to mitigate the negative financial impact of COVID-19 in the world’s poorest countries at a time when the pandemic’s medical and economic consequences were highly uncertain.

Under the DSSI, debt-service payments were suspended until the end of 2020, subsequently extended until 30 June 2021 (and new ground rules for debt restructuring for eligible countries have been articulated in a so-called ‘Common Framework’). We focus here…


Alicia Garcia Herrero, Natixis Asia Pacific Chief Economist, Bruegel Senior Fellow

Given the scorching growth of China’s bond market, that sped faster than its economy, over the recent years, it is not surprising that the year 2020 saw increasing foreign investors’ interest. While Covid ravaged economies the world over, overseas investors poured money into China’s bonds attracted, among others, by the compelling yield differential, and seemingly unperturbed by the increasing credit risk.

Foreign holdings of Chinese onshore bonds, for instance, accelerated from 2.96% in September 2020 to 3.2% …


Alicia Garcia Herrero, Natixis Asia Pacific Chief Economist, Bruegel Senior Fellow

After more than seven years of negotiations, the European Union and China finally reached a deal on a Comprehensive Agreement on Investment (CAI), just one day before the deadline that both parties had imposed themselves, namely the end of 2020.

A lot has been written on the pluses and minuses of this agreement, but the discussion has remained relatively EU-centric. …


Alicia Garcia Herrero, Natixis Asia Pacific Chief Economist, Bruegel Senior Fellow

Covid-19 will be remembered as the worst global economic shock in recent history but, compared to the most similar one, the Great Depression of 1929, its consequences on asset prices have been radically different.

In fact, the Great Depression started with an implosion of equity prices while the current pandemic started with a sharp correction in asset prices, especially as Covid reached Europe and the US in March last year, but quickly developed into one of the wildest bull markets in recent economic history.

The reason for the diametrically…


Alicia Garcia Herrero, Natixis Asia Pacific Chief Economist, Bruegel Senior Fellow

David Martínez Turégano, Senior Economist at European Commission

https://kidb.adb.org/kidb/downloads/gvc

The discussion on value chains has heated up since the US-China trade war started in 2018 and, even more so, with the scarcity of certain health products following the outbreak of the COVID-19 pandemic this year. Both geopolitics and security considerations as concerns for the the global supply chain have come to the forefront of the debate, pushing the discussion about the need to reshuffle global value chains further. …


Alicia Garcia Herrero, Natixis Asia Pacific Chief Economist, Bruegel Senior Fellow

After more than seven years of negotiations, the European Union and China appear to have reached a deal for their Comprehensive Agreement on Investment to go forward right before the deadline pressed by President Xi Jinping at the EU-China summit back in September.

The deal is important politically as it shows the EU’s commitment to its own economic sovereignty without constraints from the U.S. and it follows the example set by the 10-members of the Association of Southeast Asian Nations, Australia, Japan and South Korea in signing the Regional…

Alicia Garcia Herrero艾西亞

Senior Fellow at Bruegel

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