Despite a slowing of global economic tailwinds, China is expected to see 4.7 percent growth next year for many reasons, including domestic consumption. Government spending will expand, and private investment will be encouraged. All in all, China will gradually see a return to economic boom times.

As the internationalization of currencies in emerging economies advances, a multipolar monetary system will result. Look for an international monetary system characterized not by a single currency alone but by multiple players.

Colossal structural shifts are taking place in the global economy, as evidenced by the huge challenges of the ongoing year. In 2023, China is moving toward recovery, but the West will cope with recession and the specter of a debt crisis.

After the Xi-Biden meeting in Bali, attention should turn in earnest to a global vision in which the two countries share a common obligation — supporting globalization and multilateralism — not only to manage differences but also to avoid economic fragmentation.

In 2020, Sebastian Mallaby of the Council on Foreign Relations announced the beginning of the “age of magic money,” in which advanced economies would “redefine the outer limits of their monetary and fiscal power.” By July 2022, Mallaby was predicting that this age was coming to an end. But, while most major central banks are now reversing quantitative easing (QE) and raising interest rates, China may need to head in the opposite direction.

The meeting of presidents Xi Jinping and Joe Biden in Bali may be the first step toward restoring normal bilateral ties between China and the United States. The leaders discussed their respective red lines and agreed to resume talks on several topics. But a trust deficit remains.

We are living in a very different world. Shifting macroeconomic trends including diversification and second sourcing because of de-globalization and de-coupling have significant implications for the global economy. The strategic competition between the United States and China and other major geopolitical developments will fundamentally shape the world we live in.

Export controls are central in economic competition between the U.S. and China. A new U.S.-led multilateral export control regime could further entrench efforts to exclude China from accessing Western technology.

It is tempting to give America’s Federal Reserve great credit for its recent about-face in tackling inflation. It is equally tempting to give Chinese President Xi Jinping great credit for his stewardship of a rising and strong China. But neither deserves it – and for a similar reason.

In its pursuit for unipolar primacy, the Biden administration is risking the economic stability of China, the West, emerging Asia, and the futures of the Global South.