The US–China Financial Decoupling and Its Implications for Vietnam
Abstract
Experts and scholars are increasingly discussing the trend of US–China decoupling in the context of the two countries’ intensifying strategic conflict. This inevitable trend, though only in the early stages, has already had a significant impact in a variety of fields, including technology, investing, and banking, and is predicted to continue to grow in the future. In areas including capital markets, financial services, investments, and financial institutions, the paper clarifies the financial decoupling between the US and China. As a result of the two countries’ intense competitiveness with one another in a wide range of industries, there was a financial decoupling between the US and China. China is seeking to create its own system which includes independent financial institutions from the US-established or US-based institutions, thereby, creating independence and competing with US’s position. The US, for its part, has been proactive in conducting strong decoupling in the stock market by restricting investment in China and increasing scrutiny of the presence of some Chinese military-related companies on the US stock market. However, due to mutual interests, both countries seem to have the dilemma of separating from each other. The two countries continue the trend of decoupling but at the same time, increase cooperation in various areas including financial services. The decoupling process between the world’s two leading powers has a direct, multi-dimensional, lasting and profound impact not only on the two countries but also on the global system of institutions, rules and standards, in which the challenge side is bigger than the opportunity side. As a partner of both the US and China, Vietnam also faces direct challenges from the financial decoupling of these two powers.
The work was supported under Award number KX.04.37/21-25 through the State-level project “Strategic competition between the US and China: Vietnam’s impact and Countermeasures” within the framework of the National Key Science and Technology Program “Research on Political theory for the period 2021–2025”.
