The Economist: US will ‘shoot itself in the foot’ by imposing sanctions on China

In an interview with a newspaper Economist Experts said Washington can’t “punish” China in the same way as Russia.

Experts agreed that the United States could put pressure on China by freezing its foreign exchange reserves, which China holds two-thirds in dollars.

“But will the West really dare? Freezing China’s reserves may not be very destabilizing. “Even if China, in spite of the West, wants to get rid of its assets, sanctions won’t allow it,” said Eswar Prasad of Cornell University.

Experts also reminded that many banks that are important for the global financial system are located in China and that a “hit” on them will cause the damage to “return like a boomerang”.

Experts do not exclude that the United States may restrict access to China’s technologies, but that would be a “standing hit” as American companies themselves would be left unprofitable as they had long relied on production in China. .

“China’s biggest source of influence is its own large market. For example, America may want to deprive itself of certain high-tech resources such as semiconductors. But a complete ban would cost US semiconductor companies 37% of their revenue.

Previously reportedChina intends to act because of Western pressure on its companies.