 | Six months ago, I wrote an article offering my predictions for the year 2022. "In my view," I said, "2022 will prove decisive and be remembered as the year of Chinese President Xi Jinping's rise and U.S. President Joe Biden's fall."
My prediction still might come true, but to be honest, the world I am watching now is considerably different from the one I had foreseen. If I had been visionary enough, I would have warned about Russia's invasion of Ukraine, Shanghai's lockdown and the steepest global inflation since 1981.
From my perspective, one of the best prognosticators of the current global situation is Eurasia Group, led by Ian Bremmer, the author of the bestselling book "Every Nation for Itself: What Happens When No One Leads the World" (2013) and a frequent opinion contributor to Nikkei Asia.
Bremmer appears to have already seen the failure of China's zero-COVID policy through his crystal ball six months ago, because he put that policy at the top of a list of the 10 biggest political risks for the year. He also pointed out that if Russian President Vladimir Putin did not win concessions from the U.S.-led West, "he is likely to act, either with some form of military operation in Ukraine or a dramatic action elsewhere."
Our Big Story this week is not a forecast, but sheer journalism examining what really happened during Shanghai's lockdown. Bremmer accurately predicted "the disruption of supply chains" and "a more dissatisfied population," but what my five colleagues observed in their reporting was more than that: a humanitarian crisis.
During the lockdown, "at least 200 individuals are believed to have died, not due to COVID, but due to lack of access to hospitals," our reporters noted. Judging from social media posts that could not be verified, the zero-COVID policy led to many preventable deaths. The two most common causes were "being denied needed medical attention and suicide."
Deng Yuwen, a former editor of China's Central Party School's official newspaper, Study Times, told Nikkei that President Xi is "caught in his own trap now, as he has politicized his anti-epidemic policy."
For related reading, I highly recommend Bremmer's commentary pieces on Shanghai's lockdown, published in April, and the Ukraine war, which was published earlier this week and has been well-read.
Asia Insight this week focuses on Japanese Prime Minister Fumio Kishida's "new capitalism." I hesitate to use that expression to describe his economic policy, because it is not at all a form of stakeholder capitalism, which the term "new capitalism" reminds me of. Kishida's new policy emphasizes investment over savings. It is more like shareholder capitalism, which has been criticized in other countries for expanding the disparity in income and wealth between the rich and the poor.
Market Spotlight looks at Asia's IPO markets. New company listings in the region have slowed but are still steadier than in the U.S. and Europe. Compared with Shanghai's STAR Market or Shenzhen's ChiNext board, Tokyo's presence is negligible.
Kishida's "new capitalism" also focuses on measures aimed at creating more startups in Japan, but such paternalistic protectionism seems far removed in nature from the animal spirits of entrepreneurs. Japan will hold an upper house election on July 10. Before the vote, the ruling Liberal Democratic Party would not like to see a reduction in subsidies to inefficient and unprofitable sectors and industries, or deregulation.
Business Spotlight is another standout feature by our award-winning journalists Cheng Ting-Fang and Lauly Li. The story describes how the oil shortage caused by the war in Ukraine casts a shadow over the entire semiconductor industry. Crude oil is key to making the electronic-grade isopropyl alcohol, or EIPA, that chipmakers use to clean wafers and equipment.
For your weekend reading, I recommend this week's Tea Leaves piece by Gwen Robinson. As she describes it, thousands of soldiers have defected from Myanmar's military. Not a few wives of soldiers tell their husbands "what is right and wrong" and convince them to leave the army. Not only wars but also military crackdowns on democracy seem to have unwomanly faces, indeed.
Stay safe and healthy, and have a wonderful weekend!
Shigesaburo Okumura
Editor-in-chief, Nikkei Asia
Follow me on Twitter @ShigesaburoO
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