U.S. ‘Financial Decoupling’ from China Moves Ahead

Aug. 14, 2022 (EIRNS)—With Anglo-American warmongers driving to force full “financial decoupling” between China and the West, five huge Chinese state companies announced, separately but one right after the other on Friday afternoon, Aug. 12, that they have advised the New York Stock Exchange that they will be delisting their stocks. Each will file official notice with the U.S. Securities and Exchange Commission to this effect before the end of August, and the delisting will occur within 10 days after that.

“The ‘Writing Is on the Wall’ for ‘Chimerica’ on U.S. Stock Exchanges as $318 Billion of Chinese Equity Flees Wall Street,” Fortune headlined its coverage. The companies involved are very big: PetroChina, the largest oil and gas company in Asia; China Life Insurance, one of China’s largest state insurer companies; Aluminum Corporation of China; China Petroleum & Chemical Corporation (Sinopec): and Sinopec’s petrochemical subsidiary, Sinopec Shanghai Petrochemical.

If all 200 Chinese companies trading on U.S. exchanges were to do similarly, the equity loss would be worth more than $1 trillion, the Financial Times wrote. The two other Chinese state companies still on the exchange are widely mooted to follow suit, with Chinese private companies possibly to follow. More than 20 Chinese companies, while still listing on U.S. exchanges, have already moved to list their stocks on Hong Kong and Chinese mainland exchanges, according to Global Times.

U.S. regulators have been hounding Chinese companies for months, demanding they turn over data for the U.S. to carry out an exhaustive audit of their finances, or they will be thrown off the exchange. The audit operation is openly geopolitical, accompanied by discussion of how to carry out a full “financial decoupling” of the West from China’s giant economy. Global Times reports 159 Chinese companies were already on the SEC “delisting watch list” by the end of July.

Global Times’s coverage of the delisting announcement by the first big five reads like the clearly-coordinated move aimed to shake saner minds in the U.S. to act to head off a total break between the two economies. The pullout will have “a limited impact” on the finances of those Chinese companies, the paper argued, but the delistings “could be a blow to the influence of the U.S. financial sector across the world.... If the U.S. government continues to push for a ‘financial decoupling’ between China and the U.S., it would lead to huge losses for both markets.... The U.S. in particular should meet China halfway to reach consensus on the regulatory matter, [analysts] added. ‘US regulators should think long-term, instead of taking a shorted-sighted approach toward China.’ ”

London’s Financial Times, however, used an unnamed “former senior official at the U.S. Securities and Exchange Commission,” to deliver a message that financial decoupling remains policy. The language of U.S. regulators involved in the audit dispute has recently become “strident. It is the kind of language that suggests they know there’s no deal that is going to be done with China and Hong Kong,” the former official reports.