BANGKOK: Thailand’s inflation target should work to lift inflation above 1 per cent, Finance Minister Pichai Chunhavajira said on Tuesday (Oct 29) ahead of a meeting with the central bank governor where he hoped to be able to reach an agreement on a new target range. Pichai and Bank ofContinue Reading
BBCThe Vietnamese people smuggler emerged, briefly and hesitantly, from the shadows of a scraggly forest close to the northern French coastline.
“Move away from the others. Come this way, fast,” he said, gesturing across a disused railway line to a member of our team, who had spent weeks posing undercover as a potential customer.
Moments later, the smuggler – a tall figure with bright dyed blonde hair – turned away sharply, like a startled fox, and vanished down a narrow path into the woods.
Earlier this year, Vietnam emerged – abruptly – as the biggest single source of new migrants seeking to cross the Channel to the UK illegally in small boats. Arrivals surged from 1,306 in the whole of 2023, to 2,248 in the first half of 2024.
Our investigation – including interviews with Vietnamese smugglers and clients, French police, prosecutors and charities – reveals how Vietnamese migrants are paying double the usual rate for an “elite” small boat smuggling experience that is faster and more streamlined. As the death toll in the Channel hits a record level this year, there are some indications that it might be safer too.
As part of our work to penetrate the Vietnamese operations, we met an experienced smuggler who is operating in the UK and forging documents for migrants seeking to reach Europe. Separately, our undercover reporter – posing as a Vietnamese migrant – arranged, by phone and text, to meet a smuggling gang operating in the woods near Dunkirk in order to find out how the process works.
“A small boat service is £2,600. Payment to be made after you arrive in the UK,” the smuggler, who called himself Bac, texted back. We heard similar figures from other sources. We believe Bac may be a senior figure in a UK-based gang and the boss of Tony, the blonde man in the woods.
He had given us instructions about the journey from Europe to the UK, explaining how many migrants first flew from Vietnam to Hungary – where we understand it is currently relatively easy for them to get a legitimate work visa, often obtained using forged documents. Bac said that the migrants then travelled on to Paris and then to Dunkirk.
“Tony can pick you up at the [Dunkirk] station,” he offered, in a later text.
Vietnamese migrants are widely considered to be vulnerable to networks of trafficking groups. These groups may seek to trap them in debt and force them to pay off those debts by working in cannabis farms or other businesses in the UK.
It is clear, from several recent visits to the camps around Dunkirk and Calais, that the Vietnamese gangs and their clients operate separately from other groups.
“They keep to themselves and are much more discreet than the others. We see them very little,” says Claire Millot, a volunteer for Salam, an NGO that supports migrants in Dunkirk.
A volunteer with another charity tells us of recently catching a rare glimpse of roughly 30 Vietnamese buying life jackets at a Dunkirk branch of the sports gear chain Decathlon.
As well as keeping their distance, the streamlined service offered by the Vietnamese gangs involves far less waiting around in the camps. Many African and Middle Eastern migrants spend weeks, even months, in grim conditions on the French coast. Some don’t have enough cash to pay for a place on a small boat, and try to earn their fare by working for the smuggling gangs. Many are intercepted on the beaches by French police and have to make several attempts before they successfully cross the Channel.
On a recent visit we saw dozens of tired families – from Iraq, Iran, Syria, Eritrea and elsewhere – gathering in the drizzle at a muddy spot where humanitarian groups provide daily meals and medical assistance. A group of children played Connect 4 at a picnic table, while a man sought treatment for a wound to his arm. Several parents told us that they had heard about a four-month-old Kurdish boy who had drowned the previous night after the boat he was travelling in capsized during an attempted Channel crossing. None of them said the death would discourage them from making their own attempt.
There were no Vietnamese in sight. It seems clear that Vietnamese smugglers tend to bring their clients to the camps in northern France when the weather is already looking promising and a crossing is imminent.
We had first encountered the new influx of Vietnamese migrants earlier this year, stumbling on one of their camps near Dunkirk. It appeared to be significantly neater and more organised than other migrant camps, with matching tents pitched in straight lines and a group cooking a tantalising and elaborate meal involving fried garlic, onions and Vietnamese spices.
“They’re very organised and united and stay together in the camps. They’re quite something. When they arrive at the coast, we know that a crossing will be done very quickly. These are most likely people with more money than others,” says Mathilde Potel, the French police chief heading the fight against illegal migration in the region.
The Vietnamese do not control the small boat crossings themselves, which are largely overseen by a handful of Iraqi Kurdish gangs. Instead they negotiate access and timings.
“The Vietnamese are not allowed to touch that part of the process [the crossing]. We just deliver clients to [the Kurdish gangs],” says another Vietnamese smuggler, who we are calling Thanh, currently living in the UK. He tells us the extra cash secures priority access to the small boats for their Vietnamese clients.
While the relative costs are clear, the issue of safety is murkier. It is a fact – and perhaps a telling one – that during the first nine months of 2024, not a single Vietnamese was among the dozens of migrants confirmed to have died while trying to cross the Channel. But in October, a Vietnamese migrant did die in one incident, in what has now become the deadliest year on record for small boat crossings.
It is possible that by paying extra, the Vietnamese are able to secure access to less crowded boats, which are therefore less likely to sink. But we’ve not been able to confirm this.
What does seem clearer is that the Vietnamese smugglers are cautious about sending their clients out on boats in bad weather. Texts from Bac to our undercover reporter included specific suggestions regarding travel to the camp, and the best day to arrive.
“Running a small boat service depends on the weather. You need small waves. And it must be safe… We had good weather earlier this week and lots of boats left… It would be good if you can be here [in Dunkirk] tomorrow. I’m planning a [cross-Channel] move on Thursday morning,” Bac texted.
Sitting outside their tents in two separate camps in the woods near Dunkirk earlier this month, two young men told us almost identical stories about the events which had prompted them to leave Vietnam in order to seek new lives. How they had borrowed money to start small businesses in Vietnam, how those businesses had failed, and how they had then borrowed more money from relatives and loan sharks, to pay smugglers to bring them to the UK.
“Life in Vietnam is difficult. I couldn’t find a proper job. I tried to open a shop, but it failed. I was unable to pay back the loan, so I must find a way to earn money. I know this [is illegal] but I have no other option. I owe [the Vietnamese equivalent of] £50,000. I sold my house, but it wasn’t enough to pay off the debt,” said Tu, 26, reaching down to stroke a kitten that strolled past.
Two chickens emerged from behind another tent. A mirror hung from a nearby tree. Plug sockets were available under a separate awning for charging phones.
The second migrant, aged 27, described how he had reached Europe via China, sometimes on foot or in trucks.
“I heard from my friends in the UK that life is much better there, and I can find a way to make some money,” said the man, who did not want to give his name.
Are these people victims of human trafficking? It is unclear. All the Vietnamese migrants we spoke to said they were in debt. If they ended up working for the smuggling gangs in the UK in order to pay for their journey and to pay off their debts then they would, indeed, have been trafficked.
We had sought to draw the blonde Vietnamese smuggler, Tony, out of a nearby forest and onto more neutral territory, where his gang – possibly armed, as other gangs certainly are – might pose less of a threat to us. We intended to confront him about his involvement in a lucrative and often deadly criminal industry. But Tony remained wary of leaving his own “turf” and grew impatient and angry when our colleague, still posing as a potential migrant, declined to follow him into the forest.
“Why are you staying there? Follow that path. Move quickly! Now,” Tony ordered.
There was a brief pause. The sound of birdsong drifted across the clearing.
“What an idiot… Do you just want to stand there and get caught by the police?” the smuggler asked, with rising exasperation.
Then he turned away and retreated into the woods.
Had our colleague been a genuine migrant, she would probably have followed Tony. We were told by other sources that once in the camps, migrants were not allowed to leave unless they paid hundreds of dollars to the smugglers.
The Vietnamese gangs may be promising a quick, safe, “elite” route to the UK, but the reality is much darker – a criminal industry, backed by threats, involving deadly risks and no guarantee of success.
Additional reporting by Kathy Long and Léa Guedj
SINGAPORE: A former teacher who filmed victims using urinals – including his male colleague and a 16-year-old student – was sentenced to jail but went on to study law after his release.
At the age of 50 in May 2023, Mr Mohamad Shafee Khamis applied to be admitted as an advocate and solicitor, but was met with objections from the Attorney-General’s Chambers (AGC), the Law Society of Singapore (LawSoc) and the Singapore Institute of Legal Education (SILE).
Mr Mohamad Shafee later withdrew his application, with the court allowing it and imposing a minimum exclusionary period of two years, which means he cannot apply to be admitted within this period.
According to a judgment made available on Monday (Oct 28), Chief Justice Sundaresh Menon said this was the first case where a person applying to be a lawyer had been convicted of serious sexual offences and served his sentence.
“At one level, this might suggest that he has paid his debt to society, been rehabilitated, and was ready to be reintegrated as a member of society,” said the Chief Justice.
However, he said it was necessary to consider whether admitting him at this time “presented a real risk of undermining public trust in the legal profession and the administration of justice”, and whether more time was needed “for the court and the stakeholders to be assured that he was a fit and proper person for admission into the profession”.
Mr Mohamad Shafee was a teacher at an unidentified school in Singapore until April 2018, when he resigned.
He later pleaded guilty to four charges, with another six taken into consideration, and was sentenced to 10 weeks’ jail and a fine of S$2,000 in March 2022.
He had filmed a 31-year-old male police officer showering in his condominium’s clubhouse toilet, a 51-year-old male teacher using a urinal in the school they both taught at, and a 16-year-old male student using a urinal.
He also filmed a student changing in the school toilet, and had 128 obscene films.
It was accepted that Mr Mohamad Shafee was suffering from multiple psychiatric conditions at the time of the offences, including severe depression and voyeuristic disorder.
He did not appeal against the decision, but served his sentence from Apr 19 to Jun 4 in 2022.
From July 2019 to June 2022, Mr Mohamad Shafee enrolled in the Juris Doctor (JD) programme at Singapore Management University and graduated with a JD (High Merit).
From January to July in 2023, he undertook and completed his practice training with Vanilla Law, with Mr Goh Aik Leng as his supervising solicitor.
He then applied to be admitted to the Bar, but the AGC, LawSoc and SILE raised objections, relying heavily on his alleged shortcomings in his disclosures.
The three stakeholders also asked Mr Mohamad Shafee multiple questions, such as whether he had disclosed his offences to the Ministry of Education (MOE) and whether MOE had taken any disciplinary action against him.
Mr Mohamad Shafee stated that MOE had not taken any disciplinary action and that he had not disclosed the offences to MOE or any other staff members at the school.
In response to other questions, Mr Mohamad Shafee said he had not disclosed the offences to SMU, as it had not occurred to him that he was obliged to do so.
He said he had disclosed the offences to his character referees, but not his supervising solicitor, explaining that the firm had not asked him whether he had any criminal antecedents.
After reviewing the replies, AGC wrote to Mr Mohamad Shafee to say his offences “clearly (demonstrate) a deficit of probity, integrity and trustworthiness” and that it would object to his application for admission.
AGC submitted that Mr Mohamad Shafee should be given a minimum exclusionary period of at least four years.
“The AGC did not premise its case directly on any breach of the duty of candour though it seemed to rely on the applicant’s alleged shortcomings in his disclosures to support its case that the character defects revealed by his offences remain unresolved,” noted the Chief Justice.
AGC argued that Mr Mohamad Shafee had “a tendency to suppress details of his past wrongdoings wherever possible, in the hope that they would not come to light, which demonstrated a lack of insight into the gravity of his wrongdoing”.
LawSoc asked for a minimum exclusionary period of not less than two years, but not more than three years, saying that Mr Mohamad Shafee’s character issues “stemmed from his lack of candour” and not a lack of rehabilitative progress.
SILE’s position was broadly aligned with the AGC’s, noting the selectiveness of Mr Mohamad Shafee’s disclosures about his offences – omitting his supervising solicitor.
Mr Mohamad Shafee did not file any written submissions but gave his position in an affidavit, where he wrote: “While I respect the position taken by the AGC, I am nonetheless very disappointed and much saddened that my admission to the Bar will have to be delayed.”
He said he had registered himself as a volunteer with Action for Aids, describing this as a course of action to resolve and or prevent a reoccurrence of his persistent depressive disorder with anxious distress and voyeuristic disorder.
He wrote that he would “continue to reflect and seek to achieve an enhanced understanding of the ethical implications of my actions”, and that his efforts will ensure that by the time he made a fresh application, he would be “ready to provide such information in relation to these respects as may be required”.
Chief Justice Menon said it was not clear to him that the concerns raised by the stakeholders were entirely valid. Rather, there was “nothing to suggest that the applicant had tried to suppress the fact of his offences”.
“As I saw it, each time a clarification or further documentation had been sought from the applicant, he had complied to the extent that he could,” said the judge.
He was not persuaded that Mr Mohamad Shafee’s “attitude towards his disclosures could be said to be suggestive of a lack of ethical insight into or an abrogation of his responsibility for the offences”.
Chief Justice Menon added that the fact that he had not disclosed his misconduct to his supervising solicitor was not relevant to the current inquiry, as there was no express provision for a trainee solicitor to disclose previous convictions to the supervising solicitor.
He noted that Mr Mohamad Shafee had maintained a clean record for six years since the offences, enrolling in and graduating from law school before passing the Bar exams.
“The fact that the applicant maintained a clean record amidst the not insignificant amount of stress that comes with pursuing a course of legal study and professional training, while concurrently navigating the criminal justice process, struck me as significant and suggested that real progress was being made,” said the judge.
He said this was particularly significant because his inability to cope with stress from his workload as a teacher had been identified in medical evidence as significant contributors to the offences.
However, the Chief Justice accepted that “he had some distance to go, principally on account of the gravity of the offences and the consequent need for the court to be entirely satisfied that he had been fully rehabilitated”.
Although Mr Mohamad Shafee had served a sentence of 10 weeks’ jail for his offences, the judge said “this was one of those cases where in the eyes of the public, the admission of the applicant might reasonably give rise to concerns as to the standards of probity and virtue expected of members in the legal profession, which is an integral pillar in the administration of justice”.
“This, however, had to be carefully weighed against the significant length of time which had since elapsed in which the applicant had maintained a clean record,” said the judge.
In conclusion, he found that some time was needed despite the considerable progress already made, before Mr Mohamad Shafee could be entrusted as an officer of the court.
“I concluded that a minimum exclusionary period of two years was appropriate in the circumstances. Assuming the applicant stays the course and maintains his clean record, he will have stayed free of crime and maintained a productive and rehabilitative path for eight years, and this seemed sufficient to address the remaining concerns,” said the Chief Justice.
ReutersA prolific Vietnamese people smuggler, who entered the UK illegally this year in a small boat, has told the BBC he forges visa documents for other Vietnamese who plan to make the same crossing.
The man, whom we are calling Thanh, is now claiming UK asylum and told us he has spent almost 20 years – his entire adult life – in the smuggling industry.
He has been in prison, led a gang working on the northern coast of France, and claims to have helped more than 1,000 people to risk their lives to cross the Channel.
The self-confessed criminal met the BBC at a secret location to share detailed information about the mechanics of the international smuggling industry.
Thanh walks into the room cautiously, dark eyes moving fast as if searching for possible exit routes. A small, neat, quietly authoritative figure in a black polo neck.
There are handshakes and he says “hello” in a soft, strongly accented voice. Beyond that, we speak almost exclusively through a Vietnamese translator.
After months of phone calls and one brief meeting, the interview takes place on a grey day in a small hotel room, in a northern English town that we are choosing not to name here.
We decided there was a strong public interest in hearing about Thanh’s life in the smuggling trade, which could only be secured in return for agreeing to keep his identity confidential. He fears being recognised not only by the British authorities but by Vietnamese criminals in the UK.
Vietnam emerged in the first months of this year – suddenly and unexpectedly – as the largest single source of migrants seeking to cross the Channel to the UK illegally in small boats.
Many Vietnamese migrants have cited failing businesses and debts at home for their decision to seek work in the UK. Their first step, experts have suggested, is often to access Europe by taking advantage of a legal work visa system in Hungary and other parts of Eastern Europe.
This is where Thanh’s forgery operation comes in, he says. He helps create the fake paperwork needed to get the legitimate work visas.
“I can’t justify breaking the law. But it’s a very lucrative business,” Thanh said calmly, insisting he doesn’t provide forgeries for people seeking UK visas.
We know from our interviews with Vietnamese smugglers and their clients that people pay between $15,000 (£11,570) and $20,000 (£15,470) to travel from Vietnam to mainland Europe and then to cross the Channel.
It is a dangerous business. More than 50 people have been killed crossing the Channel in small boats already this year, making 2024 the deadliest on record. For the first time, the figures include one Vietnamese.
When our team first made contact with Thanh in mainland Europe earlier this year, we knew he was going to attempt to get to the UK with other Vietnamese. He later let us know he had crossed the Channel from northern France, in a small boat.
Thanh told us he had first flown from Vietnam to Hungary on a legitimate visa – although he had acquired it using forged documents.
He had then flown on to Paris and stayed for a few days in a “safe house”, organised by a Vietnamese smuggling gang on the city’s outskirts. Soon after then, he was taken in a group by minibus to the coast and, finally, put in the hands of one of the Kurdish gangs that control the small boat crossings.
“Once you’re on the boat, you get treated like everyone else,” he said. “It’s overcrowded.”
But the Vietnamese passengers pay three or four times more money to the gangs handling the crossing routes, he told us, “so we get the advantage of being given a place more quickly”.
In fact, our sources suggest the Vietnamese pay roughly twice the usual rate.
The journey Thanh described is now an established route from Vietnam to the UK – a path heavily promoted by smugglers on Facebook, who charge clients for forged documents, flights, buses, and a place on a flimsy rubber boat. Payment for a successful Channel crossing is only made after arrival in the UK.
And Thanh had been lucky, he told us, evading French police patrolling the beaches near Calais, and crossing in an inflatable boat on his first attempt.
Or perhaps he tried several times. Over the months that we were in contact with him, he changed elements of the story he told us – perhaps to cover his tracks and to avoid giving potential clues about his identity to the UK authorities.
Thanh asked for asylum when he was interviewed by a British immigration official – explaining he had left Vietnam because he had got into debt to gangsters when his business failed. His life, he said, was in danger.
He told the official he had been trafficked to the UK in order to work for a gang to pay off his debt.
We had heard similar stories from the Vietnamese we encountered in northern France.
When we first established contact with Thanh, he portrayed himself as a desperate migrant, first stuck in France, and then trapped in the UK’s asylum system, living in a crowded hotel, unable to work, and waiting to learn his fate.
But over time, we began to learn the truth. Or rather, Thanh began to reveal the extent to which his extraordinary life story has been built on a series of elaborate, even outrageous, lies.
Sitting opposite me on a sofa, Thanh admitted that he had not been trafficked to the UK. He had made up that story as part of his asylum claim. And he went much further, claiming that all the Vietnamese migrants he knew of had been told to offer a version of the same lie.
“Yes. A lie. I was not trafficked,” he said.
Migration experts and NGOs have a range of views about the scale of trafficking from Vietnam.
One French prosecutor told us that many Vietnamese were in debt to the smugglers and ended up working in UK cannabis farms. But he played down the idea of an organised supply chain, insisting the smuggling system was more like a haphazard series of stepping stones, with each stage controlled by separate gangs. Finding work in the UK was, he said, about luck and opportunism.
Other experts insist that many, if not most, Vietnamese migrants are victims of trafficking, and that those being taken across the Channel are in fact a cheap and easy source of labour for criminal gangs in the UK. A government registry of people suspected of being victims of modern slavery has consistently shown a high number of Vietnamese.
“It is often not possible, or helpful, to differentiate when a person has been trafficked or smuggled, especially as exploitation can happen at any time,” said Jamie Fookes, UK and Europe advocacy manager at Anti-Slavery International.
“Those crossing will often have to pay either through extortion, or from being exploited in some form of forced labour or criminality on the other side.”
Safe migration routes, he added, would be the only way to prevent traffickers taking advantage of people’s desperation.
![A screengrab of a Facebook post, written in Vietnamese, advertising smuggling services. The English translation is beneath and reads: Journey to 44 [the international country code for the UK], at a surprisingly cheap price. Fast, safe and meals and accommodation are included. Payment after a successful arrival.](https://ichef.bbci.co.uk/news/480/cpsprodpb/8811/live/186ddd30-92d4-11ef-8e6d-e3e64e16c628.png.webp)
But Thanh maintains that most Vietnamese migrants aren’t trafficked, and that it is just a line used to claim asylum.
“That’s the way it’s done. [People lie about being trafficked] in order to continue the asylum process safely,” he said.
Thanh clearly has a motive to lie about this. If he were to be caught forging documents for people who went on to be trafficked, the penalties would be far more serious than for smuggling.
In our reporting we have sought to corroborate the details of Thanh’s story – and in many instances have done so successfully. But a cloud of doubt hangs, inevitably, over elements of it.
Thanh says he first left Vietnam in 2007. He was in his late teens or early twenties. He had already dropped out of school to work in a textile factory in the south of the country. But his family wanted him to head abroad, to Europe, in search of higher wages.
“I borrowed $6,000 (£4,624) from relatives and neighbours [to pay for the trip]. A lot of people had already made the same journey. We Vietnamese have always travelled like this – to wherever it is easier to make money,” he told me.
That journey first took him to a farm outside Prague, in the Czech Republic. He spent more than a year picking spring onions and other vegetables before deciding he could do better in Germany. Crossing the border illegally in a minibus, Thanh says he threw away his passport and other documents, and chose a new name.
And he went a step further.
When he arrived in Berlin, he told the authorities he was 14 years old.
The smugglers who had charged him $1,000 (£771) to get him into Germany had advised him it would be easier if he claimed he was under 16.
“I looked young in those days. Nobody challenged me on that.”
And so, the German authorities promptly sent a man they took to be a boy to a children’s home 45 minutes’ drive from the German capital, where Thanh quickly got to work, selling black-market cigarettes in the local town.
Thanh says he stayed in Germany for about two years. He left the children’s home, found a girlfriend, and soon became a father. But a police crackdown started to affect his income from selling cigarettes. And so, in 2010, he decided to try to reach the UK.
Crossing into France without his new family, he tells us, he threw away his German documents and invented yet another false identity.
By then, thousands of migrants were trying to cross the Channel to the UK by hiding in lorries and shipping containers. Thanh says he made several attempts but was unsuccessful.
“I had bad luck. The patrols were very strict. They used dogs to detect us hiding in a container.” He claims to have reached Dover at one point, only for the truck to be returned with him and a group of other migrants still inside.
Stuck in France, camping in a forest near Dunkirk, Thanh was offered work by Vietnamese people smugglers. It was a job at which, he says, he soon excelled.
“I had to provide food and supplies and arrange to send people to the lorries at particular times. I did not recruit people, but I was paid €300 (£250) for each successful crossing,” said Thanh, insisting that none of his passengers were being trafficked or exploited.
“We just provided a service. No-one was forced. It was illegal, but it was very, very profitable.”
A few years later, the same gang – no longer linked to Thanh, he says – would be involved in the deaths of 39 Vietnamese migrants who were discovered, suffocated, inside a lorry trailer in Essex.
We need to gloss over some details of what Thanh says happened to him over the next few years in order to continue to hide his identity. He rose within a gang to become one of its senior members. But eventually, after being arrested, tried, and imprisoned for several years in Europe, he returned to Vietnam.
At which point, he might have left the smuggling world behind him. But, as he puts it now, his own reputation pulled him back in.
“People in Europe contacted me asking for help,” he told us.
“I’d already helped about 1,000 people to get to the UK successfully, so I was well known for that success.”
In 2017, he says he re-entered the smuggling trade – only this time, Thanh wasn’t smuggling people, he was forging documents for them.
Bank statements, payslips, tax invoices, anything that European embassies required to prove that people applying for student, or work, or business visas had the necessary funds to ensure they planned to return to Vietnam.
“I had a lot of clients. Depending on which embassy it was, we would provide forged bank statements or other documents.
“First, we would submit these online. If certain embassies needed to check with banks, then we’d put real cash into a bank account. We had arrangements with staff at certain banks,” Thanh explained.
“The clients couldn’t access the money themselves, but the bank staff would show the [falsified] details to embassy staff. We worked with lots of different types of Vietnamese banks.”
An expert in Vietnam told us that banking fraud is “quite common”, and there were instances of bank staff colluding with criminals to forge documents.
Thanh tells us he is not proud of his work as a forger – that he had known it was illegal and that he had done it simply to support his family. But at times he sounds boastful, observing that “people trust me, I have never failed”, and insisting his work was “not a serious crime in Vietnam”.
By now, Thanh had a new family in Vietnam. But earlier this year, he decided to leave.
It is not entirely clear why. At one point, he tells us his business had been struggling. He also mentions problems with the Vietnamese police – but he plays them down. Perhaps it is caution. But it strikes us that a lifetime of deception might have affected his ability, or his desire, to distinguish truth from fiction.
So why talk to us? Why risk blowing his cover in the UK? And why continue with his forgery business here, even now?
Thanh portrays himself as a repentant figure who now regrets his life of crime and wants to speak out to prevent other Vietnamese people from making the same mistakes. Above all, he wants to warn them against coming to the UK illegally, saying it is simply not worth it.
“I just want people in Vietnam to understand that it’s not worth borrowing lots of money to travel here. It’s not so easy for illegal arrivals to find work or make money.
“And when they do make money it’s less than in the past. It’s no better than in Germany or other European countries. I’ve been trying to find work in the grey economy, but I’ve not been successful,” he told us.
“If you want to work on a cannabis farm, there are opportunities, but I don’t want to get involved in more illegal activities now. I don’t want to land up in prison.”
Thanh urges the UK and European governments to make a bigger effort to publicise the fact there are no jobs here for illegal migrants. He also blames smuggling gangs for lying to their clients about the realities and opportunities.
But he says people back in Vietnam are hard to dissuade, suspecting those trying to warn against travelling to Europe are “being selfish and trying to keep the job opportunities for themselves”.
When we confront Thanh, repeatedly, about his hypocrisy and his own continued involvement in the elements of smuggling industry, he shrugs. It is just business.
“We don’t force anyone to do what they do. They ask us for help, as they would from any business. There’s no trafficking involved. If you have a good reputation, the clients come to you, without threats or violence.”
But what about the dangers involved – the surging number of deaths in the Channel?
“My role is just a small one in a much bigger process.”
Thanh acknowledges that his life, and that of his family back in Vietnam, would be in danger if the smuggling gangs found out he had been talking to us. When pushed, he admits to some regrets.
“If I could start again, I would not leave Vietnam. I think my life would be much better if I had stayed at home. I’ve faced so many struggles. I don’t have a bright future.”
Was he telling the truth?
At the end of our interview, he stands up, ready to leave, and for the first time, a flicker of concern, or perhaps irritation, seems to flit across his face.
Perhaps he had said too much.
Additional reporting by Kathy Long
This article first appeared on The American Mind, a publication of the Claremount Institute think tank, and is republished with permission.
Dear President Trump:
Congratulations on your November election victory. President Joe Biden and Vice President Kamala Harris have left you with a strategic disaster and a fragile economy, but you have put forward a program to keep the peace and restore economic growth. Here are some ideas that may help in your efforts, followed by more specific proposals:
Biden and Harris left you with record debts and deficits, and a dangerous household debt burden. Their reckless spending on handouts to their favored constituencies caused this inflation, not monetary policy, as David Malpass observed.
The Federal Reserve kept interest rates too low for too long and then raised them too much. Former Treasury Secretary Lawrence Summers showed that the real inflation rate is double the official number after including higher interest rates. Ask him to help the Bureau of Labor Statistics publish the real inflation rate.
You need a stable monetary policy instead of the Fed’s boom-and-bust whipsaw. Put people on the Federal Reserve Board who understand how monetary policy actually works instead of the ideologues who run the Fed today.
The biggest obstacle to industrial revival is the lack of skilled labor, thanks to the liberals who control US education. Summon the CEOs of our biggest manufacturing companies, and they’ll tell you the same thing: less than a quarter of US high school students are proficient in math. That puts high-end jobs in computer-controlled manufacturing out of their reach.
We can fix the problem by enlisting state community college systems in partnership with corporations. Florida already has the ball rolling. Ask Governor Ron DeSantis to head an emergency effort to train skilled workers.
For the first time in American history, America imports more capital goods than we produce for domestic consumption. The downside of tariffs is that they will increase costs for manufacturers who rely on foreign inputs, and domestic substitutes will take time and money to provide. You might propose a tariff rebate for American manufacturers who buy Chinese capital goods to expand production in the US.
The tax system is rigged against capital-intensive investment, raising the after-tax cost of capital for manufacturing. America’s stock of manufacturing equipment hasn’t risen in 20 years according to the Federal Reserve.
To return to a long-term growth trend, we need about $1 trillion in capital spending. GOP leaders in Congress should propose emergency legislation to allow immediate tax write-offs of capital equipment.
The 2017 corporate tax cut, which increased the number of years required to expense capital equipment, should be revised to allow immediate expensing of capital equipment. That may be a bigger stimulus for domestic manufacturing than tariffs.
You outraged the foreign policy swamp when you denounced endless wars, and they spent four years trying to remove you from office. The swamp bet the farm on endless war in Ukraine, and your refusal to play along makes you their irreconcilable enemy.
Don’t underestimate how determined they are to stop you. You hired establishment types in your first administration and had cause to regret it every time. Now, there’s no room for compromise with the swamp.
The Deep State entrapped your first National Security Adviser, General Mike Flynn, and his successors H R McMaster and John Bolton repaid your trust by turning on you. You can’t trust the failed, feckless foreign policy establishment.
It knows nothing but forever wars and meddling in other countries’ affairs. The problem is that the establishment has controlled promotion in government service and academia for three generations, so any candidate with a big resume got it the wrong way.
Vance may not have a lot of foreign policy experience, but common sense is a better qualification than years of pushing incompetent policies. Ask Victor Davis Hanson to run foreign policy and national security recruitment for the transition team.
And continue to seek the advice of Hungary’s Prime Minister Viktor Orban, your strongest supporter overseas and the smartest politician in Europe. Vance’s plan to end the war in Ukraine—establishing a ceasefire, a buffer zone, and Ukrainian neutrality—will do the job.
David Friedman did a brilliant job crafting the Abraham Accords as Ambassador to Israel in your first term. Persuade him to return to the job. The Biden administration treats Saudi Arabia like a pariah and cozies up to Qatar, the host and paymaster to Hamas.
That’s an outrage, especially after the October 7, 2023 massacre. Reach out to the Saudis and the UAE. Otherwise, US influence in the region may dissolve in the face of China’s diplomatic initiatives.
You rightly proposed a missile shield to protect the United States. Reviving Reagan’s Strategic Defense Initiative is the best defense policy anyone has put forward in years.
You will get bad advice from the uniforms. They wasted trillions building the wrong kind of military and will try to justify their previous blunders by demanding more of the same. We don’t need nearly a quarter million troops deployed overseas.
The Navy’s expeditionary forces are obsolete. Surface ships are sitting ducks for anti-ship missiles—and China has thousands of them. Meanwhile, our depleted industrial base can barely build one submarine a year.
The Pentagon brass will feed you phony scenarios to justify more obsolete legacy systems. Hire experts who see through flummery like Air Force officer and Stanford Professor Oriana Skylar Mastro.
You can’t trust the US Intelligence Community. Fifty-one senior intelligence officials signed a statement in 2020 claiming that the Hunter Biden laptop story was a Russian hoax. That might have cost you the election. Their appointees hold all the senior jobs today.
Seventy percent of the US intel budget goes to private contractors, opening the system to cronyism and corruption. It will take years to clean up this mess. In the meantime, create a “Team B,” a small group of people you can trust at the National Security Council to keep you informed on world affairs and double-check the CIA’s daily briefing.
Don’t trust the “process people” at the White House. Your Deputy Chief of Staff Chris Liddell told a Republican luncheon not long ago that by picking the people who would attend meetings at the Oval Office and assigning their roles, he could predetermine your decisions 90% of the time. Bring in outsiders who work for you, not the swamp.
We’re in a situation like 1973, when Soviet air defense ruled the skies. In less than ten years we invented smart warfare, turned the tables on Russia, and began winning the Cold War. We invented the Digital Age as a byproduct of our revolution in defense technology.
Don’t put a flag officer or defense contractor lobbyist in charge of the Pentagon. Appoint a defense secretary with deep knowledge of new military technologies, someone like Michael Griffin, your Under Secretary of Defense for Research and Engineering and the former head of NASA.
Under fiscal constraints, we can’t expand defense spending across the board. Focus on missile defense for the American homeland and American military assets. Cut legacy spending on forever wars, like the 230,000 US troops deployed overseas, and legacy systems like aircraft carriers.
Your first two defense secretaries came respectively from the Marines and the defense industry—and both of them tried to stop you from winning in 2024. You would be better served by a scientist who understands high tech in defense of the American homeland. Chips for defense and critical infrastructure should be produced at home under secure conditions.
Biden’s CHIPS Act is a disaster. It gave $8.5 billion to Intel just before it laid off 10% of its workforce. Worst of all, it left out R&D for chips based on new technologies. We’ve played Whack-a-Mole with China’s chip industry for five years. The battle for semiconductor dominance will be won by chips using interaction at the molecular or atomic level, with speeds orders of magnitude faster than silicon.
Finally, the swamp bet the future of NATO on the Ukraine misadventure. That disaster will cripple, if not destroy, NATO in its present form.
We’ve spent $7 trillion on forever wars. China spent $1 trillion on its Belt and Road Initiative. We lost influence and power, whereas China gained both. China’s exports to the US, Europe, and Japan are stagnating, but its exports to the Global South have doubled since you left office. China now exports more to the Global South than to all developed markets combined.
A lot of Chinese exports to the Global South are indirect exports to the US: China builds, plans, and ships components to Vietnam, India, and Mexico, and they export in turn to the US. This translates into a jump in Chinese influence in Asia, Europe, the Middle East, and Latin America, and more US dependence on Chinese supply chains.
China is gaining on us. At best, sanctions on exports of US technology to China buy time. At worst, they will backfire: Instead of keeping China dependent on our products, we have handed Chinese companies a captive domestic market for legacy chips and chip-making equipment.
We beat Russia in the Cold War by inventing the Digital Age, using NASA and the defense budget to drive breakthroughs in new technologies. We can innovate better than China. But federal support for R&D under Reagan was double its present level as a percent of GDP.
That’s why it’s critical to shift the defense budget to support new technology. To take only one example: We can’t out-produce China in missiles. The best response to China’s huge force of anti-ship missiles is directed-energy weapons (for example, lasers). But the Pentagon R&D budget for these new weapons is less than $800 million a year, or the cost of ten fighter planes.
We want to maintain the status quo over Taiwan. China won’t risk using force as long as Taiwan doesn’t move toward independence. With thousands of anti-ship missiles and hundreds of 5th-generation aircraft, China already outguns us in the South China Sea. To keep the balance of power, we need new anti-missile technology—not more sitting ducks in the form of surface ships.
Act at once on your proposal to combine steep tariffs on Chinese EV imports with an invitation to Chinese companies to build plants in the US. As Elon Musk well knows, China has a big lead in industrial automation, including AI applications and 5G communications.
Xiaomi just opened a fully automated plant that can turn out 1,000 cars a day. No US company can make an EV with a sticker price under $10,000 like BYD’s Seagull. It’s like the 1980s when Japanese automakers had better technology than Detroit. Forcing the Japanese to build plants here helped the U.S. auto industry get up to speed.
Just as we did during the Cold War, we need to harness America’s unique capacity for innovation to renew our industrial base. And if you can guide us there, Mr. President, your second administration will be remembered as a turning point in American history.
David P Goldman is deputy editor of Asia Times, a Washington fellow of the Claremont Institute and a senior writer for Law & Liberty.
Asia is suddenly starting to think about the “what-if” storm that will sweep Donald Trump and his Republican Party to win on November 5th. situations.
Despite the extremely close election in the US, Kamala Harris ‘ Democrats constantly had a statistical advantage. The GOP-controlled White House, Senate, and House of Representatives is currently influencing betting markets, which will force Asia to fight a” Trump business” circumstance in 2025.
Most Asian officials prefer Harris, as she would represent stability from Joe Biden’s administration. Trump’s industry policies alone had transform the world economic system, which is unusual.
The most immediate danger from Tokyo to Jakarta to the rest , of export-oriented Asia is Trump’s supersized taxes. The Trump plan for a 60 % tax on China will stifle growth in Asia’s largest economy and stifle supply stores everywhere.
UBS , Group thinks that tariff alone will cut China’s annual growth by more than half – chopping 2.5 percentage points off the gross domestic product ( GDP ) of the globe’s top trading nation. Due to weak retail spending, property purchase, and new home sales, China increased just 4.6 % in the third quarter year over year.
Over time, UBS , analyst Wang Tao warns of the “risk of various nations raising tariffs on imports from China as well”, kicking off a prospective hands culture of tit-for-tat trade restrictions.
It’s not the end of the world, of training. As Tianchen Xu, senior analyst at The Economist Intelligence Unit, information, China’s full-year GDP target of around 5 %  , “is presently within approach with more stimulus in the third fourth”.
Despite the magnitude of these” challenges”, Xu notes,” China’s economy is not incurable as some would suggest”. However, Trump’s return to the height of massive trade wars was quickly alter that situation.
Trump has threatened to impose taxes of between 100 % and 20 % on imported cars from Mexico, and he has threatened to increase Biden’s new punitive tariffs on Chinese electric vehicles even further. But how long will it be before Chinese, South Asian and Indian-made cars face comparable Trump levies?
For maneuvers did put Thailand and other Southeast Asian export-oriented economies in harm’s way. Trump 2.0 may aggravate Thailand’s” Detroit of Asia” styles on being the leading China fence for international automakers.
According to Capital Economics ‘ chief economist, Neil Shearing, Asia is anticipating a “universal tariff on all imports to the US” as well as higher Trump taxes.
Additionally, Eastern policymakers must figure out how much more stringent the restrictions on US immigration will cost. Additionally, Trump has promised fresh tax breaks, which will only help the US’s$ 35 trillion national debt grow.
” While it’s reasonable to assume that many of Trump ‘s , campaign pledges will be diluted , when faced with the reality of government, the common thread running through each of these proposals is that they will end in higher inflation”, Shearing says.
By the middle of 2026, according to Capital Economics, Trump 2.0 plans could increase prices by two percentage points over recent levels. Real GDP may be roughly 0. 75 % lower while the federal funds rate would be roughly 50 basis points higher. ” Used up”, Shearing says,” this would be bad for both US bonds , and , stocks”.
The comments effects may be felt worldwide. Shearing notes that “emerging markets with higher levels of additional debt or northern banks that are especially vulnerable to movements in the exchange rate – somewhat Turkey, Indonesia, and, given its latest inflation problems, Brazil – would probably dial up the pace of monetary easing.”
Shearing adds that” the risk of higher tariffs, if implemented, could also have a significant impact on countries that trade with the US – Mexico, Korea, Vietnam and, of course, China— especially if Trump imposes a general tariff, which would be much harder to avoid through trans-shipment”.
Trump’s policies may have an impact on emerging markets and investment. ” Tariff concerns have been a drag on EU equities”, says Emmanuel Cau, a strategist at Barclays.
Emre Peker, an analyst at Eurasia Group, notes that ,” Trump’s threat of at least 60 % tariffs on all Chinese goods and a 10 % levy on US imports from the rest of the world, as well as his potential suspension of China’s most-favored-nation trading status under World Trade Organization rules, would stoke EU-China , trade , tensions as more Chinese overcapacity flows to Europe. It could also increase the pressure on European industries, which are already struggling against US and Chinese rivals, from metals to automotive, green energy, and technology.
This, Peker adds,” could put pressure on Brussels to be more forward-leaning on its own duty or tariff posture toward Beijing. Furthermore, a , Trump , administration would likely monitor third countries for possible trans-shipment of Chinese goods and/or circumvention of US tariffs against Chinese overcapacity, threatening additional duties on the EU and others to close any backdoors into the US market”.
One of the bigger wildcards about a Trump presidency is that the US dollar will increase, putting downward pressure on China’s exchange rate. Carie Li, a global market strategist at DBS Bank, says “markets are watching if the Trump trade is heating up and pushing the yuan back to 7.15 against the dollar.”
Some people believe there is a reason to worry about Trump. According to Bilal Hafeez, CEO and head of research at Macro Hive,” The fixed income selloff accompanying rising odds of a Republican sweep could be overdone because Trumponomics is likely to be more rational than the media conveys.”
Hafeez goes on to say that” the impact of the tariffs on inflation has been greatly exaggerated. The US is a domestic-driven economy. Consumer goods imports, excluding cars, represent only about 5 % of total consumer spending, with imports from China accounting for about 40 %”.
A 60 % tariff increase on imports from China and a 10 % tariff increase on imports from other countries could increase consumer price indices by about 150 basis points, according to Hafeez.
However, crypto bets and other assets are all being negatively impacted by Trump’s re-election specter. ” Elections remain hard to call, but if you are long crypto here, you are likely taking a Trump trade”, says Bernstein analyst Gautam Chhugani.
Most troubling about Trump 2.0 is what Asia does n’t know. Imponderables abound. Trump’s first act as president in 2017, remember, was pulling out of the Trans-Pacific Partnership ( TPP ). A President Harris, by sharp contrast, will almost certainly attend next year’s Asia Pacific Economic Cooperation ( APEC ) summit and as she did in Bangkok in 2022 declare the US a” Pacific nation”.
But it’s easy to count the ways Trump might shake up Asia’s 2025 and beyond. He would undoubtedly act to lower the dollar in order to boost US manufacturers ‘ competitiveness, for instance. That could worsen the negative effects China’s current headwinds and undermine confidence in the dollar as a global reserve currency.
Trump will undoubtedly pounce on the Federal Reserve during a second term. Trump will browbeat Fed Chairman Jerome Powell to lower rates in 2019. Trump also considered firing Powell, along with criticizing the Fed on social media. Thus, Powell injected unneeded liquidity into a struggling economy.
Recently, Trump argued that ,” the president should have at least a say in” Fed interest rate decisions. Meanwhile, the” Project 2025″ scheme that the Heritage Foundation right-wing think tank devised for Trump 2.0 favors meddling with the Fed’s mandate.
Then there’s the default risk.  , As a businessman in decades past, Trump was a serial bankruptcy filer. Trump made hints about US debt default while campaigning in 2016 and spooked Wall Street.
” I would borrow, knowing that if the economy crashed, you could make a deal”, Trump told CNBC when asked about his fiscal plans. ” And if the economy was good, it was good. So, therefore, you ca n’t lose”.
In 2020, the Washington Post reported that Trump officials, looking to punish China, mulled canceling debt held by Beijing. It’s not difficult to comprehend how catastrophic a catastrophe would be because the US national debt is now twice the size of the Chinese GDP.
Trump is not going away, even if Harris wins on November 5. There is only a slim chance that Trump will graciously concede defeat and go back to his golf courses. Trump’s legal team is already working on the election results, which could incite a 2021-like insurrection that will be staged at locations across the country.
Washington’s political polarization could lead to unexpected risks that would cause the laws of financial gravity to resurface. The last insurrection , Trump fomented dragged Washington’s credit , rating , down with it. When , Fitch , Ratings , yanked away Washington’s AAA status last year, it cited the insurrection as a key factor.
As , Fitch , put it, the chaos on , January , 6, 2021, was a “reflection of the deterioration in governance” imperiling US finances. The US national debt is now twice the size of , China’s GDP, threatening Washington’s last remaining AAA , rating , from Moody’s Investors Service.
Here, it’s worth noting how a Trump 2.0 presidency would play into Beijing’s hands. Surely, Team Xi is n’t looking forward to Trump’s coming onslaught of tariffs. However, the ways that nations like Japan and Korea could end up as collateral damage may make China appear more appealing as a trading partner.
At the same time, the more Trump 2.0 blocks Asia’s access to US markets, the more governments in Bangkok, Jakarta, Manila, Putrajaya and Singapore might be incentivized to draw closer to Beijing.
Hence Asia’s worries about a “red wave” 11 days from now that makes economic paranoia great again. Policymakers in the region are already weighing how hard their economies would be hit by tariff-sealed US markets and how to respond as the odds of Trump’s return rise.
Follow William Pesek on X at @WilliamPesek
Cassandra, the lady, cautioned her brother Troy that the wooden animal outside the wall of Troy was full of Greek warriors in Greek mythology. No single questioned her. The horses was brought into the town by the Trojans. Catastrophe ensued.
The national president’s rising debt has had many Cassandras. For centuries they’ve been predicting that the repayments continued growth may lead to disaster. Obviously, no one in Washington believes them.
Congress keeps passing gap costs that increase the amount of loan. It does n’t matter which party controls Congress, both yawn when the Cassandras issue their warnings.
In the just-ended fiscal year, the federal government – Democrats in control of the House, Democrats the Senate – spent$ 1.83 trillion more than it took in. That brought Uncle Sam’s accumulated debt to around$ 35 trillion.
If the nation had a gross domestic product in the neighborhood of$ 75 trillion, or even$ 50 trillion, the lips of the Debt Cassandras would be sealed. A sizeable market may result in more taxes than enough to allow the government to give its interest payments and possibly even lower the primary.
Alas, the US GDP is simply$ 25 trillion.
Some experts say a government-debt-to-GDP ratios above 60 % begins to raise red flags. Some say 77 %. Uncle Sam’s amount is above 130 %. In other words, simply counting the debt held by the government leaves out debts that one portion of the government owes another, the ratio is about 100 %.
By 2034, the public’s projected bill under current rules will increase to 125 %. If Kamala Harris is elected, the nonpartisan Committee for a Responsible Federal Budget projects a 133 % increase in GDP by 2034 and a 142 % increase if Donald Trump wins.
Throw away the difference between the two, there’s bounce place in these quotations. Both applicants are making promises about tax breaks and handouts that will force the bill like jet fuel.
Since the Bill Cassandras started predicting crisis, it has been many years since crisis has not occurred. The debt-to-GDP percentage has soared past the red flags, yet investors keep buying the US Treasury’s report. The Cassandras might remain mistaken. Had a significantly higher debt-to-GDP ratio get the real danger point than experts had predicted? Sometimes there’s nothing to fret about.
Cassandra had predicted Troy would get destroyed if the Trojans had stolen Helen, the most attractive woman in the world, from her Greek father Menelaus earlier in the story. No single took that revelation really, either.
It did n’t help that 10 years elapsed before it came true. As day passed and Troy continued to live unhurt, the Trojans were lulled into confidence. Cassandra’s like a cynic! Why consider her?
The passage of time, combined with confusion about the repayments threat level, has also lulled Washington into confidence. Uncle Sam keeps borrowing and borrowing.
Sure enough, the government is also able to make its curiosity payment. However, those bills are consuming an increasing portion of the national budget. Debt-related attention now exceeds military spending. Interest payments may surpass Social Security as the national budget’s single largest line never in a long time.
Bill Cassandras point to an even more serious issue, aside from the snowballing effect of higher interest rates on the national budget. Investors in the administration’s bonds and notes will eventually be really concerned about getting the principal repaid as the bill mounts.
When that happens, need for the government’s sheet will fall. The government will need to offer significantly higher interest rates in order to buy it. These higher interest rates may only serve to further exacerbate the loan issue.
The economy will also be affected by those rates, and Congress wo n’t be able to reinvigorate it with deficit spending and tax cuts this time. Quite the opposite: The soaring interest rates on the government’s individual bill will force Congress to increase taxes and cut spending, more depressing the economy. In that dreadful situation, farm program expenditures are likely to be minimized.
Truth is, no one knows the debt-to-GDP amount that may make lenders stress. Optimists point out that Japan’s debt-to-GDP amount is 250 %. But that number is false, an study from the Federal Reserve Bank of St. Louis concludes. The balance sheets of both countries ‘ institutions show the same net duty of 119 % of GDP, taking into account things like intra-governmental payments and supply money. ( https ://www .stlouisfed .org/… )
Japan’s uniqueness comes in part because of the country’s great national savings rate and the fact that comparatively few foreigners own the country’s debt.
Governments like the US that borrow in their own money can simply write cash to repay it, according to the small minority of economists who adhere to the so-called modern economic theory. That’s correct, and the government perhaps had print money in a turmoil. But the resulting prices would be awful.
We do n’t know how long the debt can continue to grow before creditors start to panic and flee to safety. The more years go by without it taking place, the greater the desire for optimists, including almost everyone in the nation’s capital, to believe it might never take place.
We must hope that the country is caught up in their wagon and that the realists are correct. However, there is a real chance that the Bill Cassandras will turn out to be Cassandra of Troy, their prophecies being fulfilled but unheeded, leading to their fellow citizens’ great misfortune.
Previous lifelong Wall Street Journal Asia journalist and editor , Urban Lehner , is writer professor of DTN/The Progressive Farmer.
This , content,  , previously published on , March 8 , by the latter news business and then republished by Asia Times with authority, is © Copyright 2024 DTN/The Progressive Farmer. All rights reserved. Follow , Urban Lehner , on , X @urbanize ,
China is steadily establishing itself as a significant participant in the recently-named Global South, which was formerly known as the Non-Aligned Motion. Over the last few years, China has become the country’s biggest bank of developing countries. Many people are concerned about using the debt trap to subdue partners and create a “hegemonic sphere of influence” as a result.
China’s financial standing is such that it is now viewed as the biggest risk to the US dollar. It is an important part of the BRICS party ( which also includes Brazil, Russia, India and South Africa ). This team is attempting to create a unipolar world that challenges the West’s identity, particularly the United States ‘ management.
Without using the name” threat”, the US leadership now sees China as the “most major long-term concern” to the global order. Given that China’s corporate goal is to stop the dominance of the US dollar, the foundation of US hegemony, it is simple to understand why.
I am studying the role China is playing in the de-dollarization of the world as a scientist in global political economy at the Université Laval.
The power of the US dollar supports American identity in the current international order, as French scholar Denis Durand explains in his content” Guerre monétaire militaire: l’hégémonie du money contestée”? ( International forex war: the economy’s identity challenged? ).
American currency is used in many Third World and Eastern European nations, where it enjoys a much higher level of public trust than local currencies, in addition to the point that some currencies are linked to the money by a fixed connection or group of variation. The only nation in the world that is levy foreign bill in its own currency is the United States.
The US dollar’s overrepresentation in the country’s central bankers ‘ foreign exchange reserves reflects its hegemony over the world market. Even though this has weakened, the dollar continues to outperform another assets.
The promote of the US dollar in the standard property of the country’s central banks is still roughly steady at around 58-59 % despite a 12 percent point decline between 1999 and 2021.
The US dollar continues to inspire a lot of confidence around the world, strengthening its position as the world’s dominant reserve currency. On the US investment industry, the country’s central bankers ‘ US dollars resources are invested in US Treasury bills, which lower the cost of financing both government loan and personal expenditure in the country.
However, the US economy may lose money if the identity of the dollar did. When Durand asserts that” the economic hegemony of the United States is held up only by the assurance of financial agents around the world in the American money,” he makes this point.
There are two possible causes of a decline in the nation’s confidence in the US dollars.
First of all, as US Treasury Secretary Janet Yellen stated in an interview in April 2023, the US is firmly using its dollars as a tool to manipulate both its own enemies and some rebellious allies. This was eventually destroy the dollar’s hegemony.
On the other hand, the US loan situation, especially its unsustainability, is a source of concern that could change the economy’s attractiveness as a global reserve currency.
Since 1944, and even more so since the Bretton Woods Agreement‘s enactment in 1959, the US dollars has been at the center of the global financial system.
The Bretton Woods system was based on both the metal and the franc, which was the only money that could be converted into gold. This conversionibility was set at a rate of US$ 35 per gram.
That changed on August 15, 1971, when Richard Nixon announced the close of the economy’s conversionibility into gold as a result of inflation and the growing disparities in the United States ‘ global economic ties.
The ability of the United States to accept debt to meet people expenditures was constrained by the dollar’s gold price. The United States could only lend in accordance with the volume of dollars in liquidity and its gold reserves under the gold-based system, where silver was the surety of the US dollar.
The US had free rein over its debt after abandoning the gold-based system. In 2023, the US public debt reached more than$ 33.4 trillion, nine times the country’s debt in 1990.
This astronomical figure continues to raise concerns about its long-term sustainability. As US Federal Reserve Chairman Jerome Powell has pointed out US debt is growing faster than the economy,  , making it unsustainable , in the long term.
China is obviously aware of this reality because it recently sold off all of its US debt. Between 2016 and 2023, China sold$ 600 billion worth of US bonds.
However, in August 2017 China was the United States ‘ largest creditor, ahead of Japan. It held more than$ 1.146 billion in US Treasuries, almost 20 % of the amount held by all foreign governments. Beijing is now the second-largest foreign holder of US debt, with a claim of around$ 816 billion.
It is undoubtedly no coincidence that Beijing first instituted its own gold pricing system in the yuan before delving into US bonds. In fact, on April 19, 2016, the Shanghai Gold Exchange, China’s operator for precious metals, unveiled on its website its first “fixed” daily benchmark for gold at 256.92 yuan per gram.
China’s plan to make gold a tangible guarantee of its currency includes this policy.
China is also selling its US bonds. According to the US Treasury, between March 2023 and March 2024, China sold off$ 100 billion in US Treasuries, on top of the$ 300 billion it had already sold off over the past decade.
The Middle Kingdom is now the top producer and consumer of gold, which has replaced roughly a quarter of the US Treasuries sold in ten years. Other central banks in emerging markets continue to buy gold, just like China’s central bank.
China’s appetite for gold was confirmed in 2010, when its gold reserves rose to 1, 054 tonnes, from around 600 tonnes in 2005. Ten years later, in 2020, its stock of gold had almost doubled again to nearly 2, 000 tonnes. By the end of 2023, with a gold reserve of 2, 235 tonnes, China will be the country with the sixth-largest gold reserve.
Gold allows China to store the profits from its enormous trade surpluses in its place of the dollar. Beijing is attempting to increase its currency’s use abroad with the help of the Shanghai Gold Exchange, which provides contracts for gold trading contracts in yuan. This will help establish the yuan as the world economy’s benchmark currency.
Zakaria Sorgho is senior fellow at FERDI &, ACET-Africa and research associate at CREATE, Université Laval
This article was republished from The Conversation under a Creative Commons license. Read the original article.
It’s going to be a active, anxious and challenge-laden International Monetary Fund meeting in Washington this month.
There, the financial glitterati will fight a bewildering range of hot-button issues ranging from China’s decline to Germany’s crisis to geopolitical risks everywhere to a toss-up US election that’s screening nerves everyday. Put in the IMF’s instructions about a US$ 100 trillion people loan timebomb.
Amazingly, Washington may become hosting this week’s next most effective economic gathering. The more enthralling function will be in Moscow, where the BRICS countries are holding their annual conference.
Some observers predicted that the grouping, which combines Brazil, Russia, India, and South Africa, would eventually have been a sideshow. In 2001, then-Goldman Sachs analyst Jim O’Neill coined the BRIC acronym. In 2010, the four original users added South Africa.
In the decades since, the BRICS seemed to reduce forward thrust. In a 2019 review, Standard &, Poor’s said the union had lost impact.  , Around that same day, O’Neill himself took some photos at his design.
O’Neill recently wrote that” the divergent long-term financial direction of the five states weakens the scientific value of viewing the BRICS as a clear economic grouping.” According to some people, I’ve made jokes about how appropriate it would have been to call the name “IC” , given the obvious debacle of the Portuguese and Soviet economies in the last decade since 2011, both of which have obviously performed significantly worse than  , what the 2050 scenario path laid out.
However, the BRICS have since recovered some of their momentum and are now adding five more users. This year, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates may join the slide.
Mariel Ferragamo, an analyst at the Council on Foreign Relations, information that” the addition of Egypt and Ethiopia will intensify tones from the African continent. Egypt likewise had close business ties with China and India, and social ties , with Russia”.
As a fresh BRICS part,  , Egypt” seeks to , get more investment , and increase its damaged economy”, Ferragamo information. ” China has long courted Ethiopia, the third-biggest business in sub-Saharan Africa, with , billions of dollars of investment , to make the region a hub of its Belt and Road Initiative. The addition of Saudi Arabia and the UAE would send in the , two biggest economies , in the Muslim world and the next and eighth major oil producers internationally”.
The schedule of this growth dovetails with a major BRICS plan: de-dollarization.
The BRICS announced plans to create a “multilateral online lawsuit and pay system” called BRICS Bridge in February, which “would help bridge the gap between the financial markets of BRICS member countries and promote joint trade.”
According to reports, the gathering this week will use a new strategy to make efforts to replace the US dollar more quickly. Udith Sikand, an analyst at Gavekal Dragonomics, notes that one idea is for a gold-backed BRICS monetary unit.
According to Sikand, it seems unlikely that any single currency could get past this compulsion to completely replace the US dollar’s central role.
” A wide range of currencies could, in a more multipolar world, theoretically chip away at their enormous role. The logical consequence of a change would be that while the dollar is still important to global trade and capital flows, its ability to serve as a safe haven when stress is diminished as investors weigh their options from a myriad of alternatives.
The West needs to understand how much it makes the BRICS more comfortable. After all, this opening for the Global South is largely attributable to the Bretton Woods gang messing up their individual economies and, consequently, the global system.
Take the US, which is rife with political chaos at a time when the nation’s debt is over$ 35 trillion. The risks posed by the upcoming , November 5 election alone have credit rating companies on edge, particularly Moody’s Investors Service, which is the last to assign Washington a AAA grade.
Germany is flatlining, highlighting headwinds bearing down on the broader continent. As Germany’s Economy Ministry puts it, “economic weakness likely continued in the second half of 2024, before growth momentum gradually increases again next year”, adding that “technical recession” risks abound.
The European Central Bank’s decision to cut rates for the third time this year last week highlights the level of concern.
Allianz Global Investors ‘ global chief investment officer, Michael Krautzberger, claims that” this increase in the speed of rate cuts is justified because the combination of sub-trend euro growth and target inflation supports a much less restrictive monetary policy than is currently the case.”
Krautzberger adds that” there are some hopes that recent Chinese policy support will help trade-sensitive markets like Germany, but we doubt that will be sufficient to offset the region’s weak domestic demand picture.” There is also a chance that trade disputes will return to the policy agenda after the upcoming US elections in November, adding to the risk of negative growth.
Making matters worse, according to the US and China’s combined borrowing patterns, public debt levels are projected to reach$ 100 trillion this year.
” Our forecasts point to an unforgiving combination of low growth and high debt – a difficult future”, says IMF managing director , Kristalina Georgieva. ” Governments must work to reduce debt and rebuild buffers for the upcoming shock, which will undoubtedly occur, and perhaps sooner than we anticipate.”
Such unthinkable debt levels pose a serious and immediate threat to the world financial system. In a recent report, IMF analysts wrote that “higher debt levels and uncertainty surrounding fiscal policy in systemically important countries, such as China and the United States, can lead to significant spillovers in the form of higher borrowing costs and debt-related risks in other economies.”
These spillovers could make monetary policy decisions in both Asia and the world more difficult.
Officials from the Bank of Japan are declaring their intention to keep raising rates in Tokyo. Yet that’s despite data showing renewed weakness in retail sales, exports, industrial production and private machinery orders. and concerns among ministry of finance officials about the potential return of deflationary forces in the months to come.
Even though inflation is easing in Japan,” the central bank has made clear that it will raise interest rates”, says Danny Kim, an economist at Moody’s Analytics. ” At best, this will slow growth. At worst, it could trigger a wider economic decline”.
All of this raises the question of whether the world’s top economies are complacent about potential dangers.  ,
As officials arrive in Washington, there’s considerable relief that the US has n’t experienced the recession that the vast majority of economists predicted. Or that China’s downshift had n’t pushed mainland growth too far below this year’s 5 % target.
However, there is reason to believe that this is the last sigh before the storm. The geopolitical path is as dangerous as they can get. Middle East tensions are rising as Russia’s war against Ukraine drags on, aside from the ominous debt milestone that the IMF has flagged. And then there’s the return of the” Trump trade”.
Polls indicate a close race between Kamala Harris and former US President Trump. The betting markets, though, suggest Trump might prevail. If so, Asia could quickly find itself in harm’s way.
Trump’s threat to slap 60 % tariffs on all Chinese goods is just the beginning. Many people predict that a Trump 2.0 administration will impose much higher taxes and trade restrictions, wreaking havoc on Asia in 2025.
Even if Trump loses to Harris, he’s hardly going to accept defeat and move on peacefully. Many people are already concerned that their supporters may launch an attack on the US capital to protest his demise because the election was stolen. That’s likely to imperil Washington’s credit rating anew and spook investors pushing Wall Street stocks to all-time highs.
The fallout from the Trump-inspired January 6, 2021 insurrection was among the reasons Fitch Ratings revoked its AAA rating on US debt, joining Standard &, Poor’s. The question now is whether Moody’s downgrades the US, too.
This uncertainty favors the BRICS. Southwest Asia is also clearly orienting its attention toward the BRICS countries.  , All this is a global game-changer that few in the West saw coming.
Earlier this year, Malaysia detailed its ambitions to join the intergovernmental organization. Thailand and Vietnam are also interested in joining the Association of Southeast Asian Nations, which is a group of nations. In Indonesia, an increasing number of lawmakers are BRICS curious, too.
Joe Biden, the president of the United States, may be dealt a particularly bad blow by Southeast Asia’s involvement. Since 2021, a regional bulwark has been a hallmark of the Biden era in opposition to China’s growing influence and attempts to replace the US dollar in trade and finance.
The BRICS phenomenon demonstrates a growing stutter in relations between the US and many ASEAN members. This, at a time when , Saudi Arabia , is looking to phase out the “petrodollar”. As China, Russia, and Iran square off against old alliances, Riyadh is making more efforts to de-dollarize.
” A gradual democratization of the global financial landscape may be underway, giving way to a world in which more local currencies can be used for international transactions”, says analyst , Hung Tran at the Atlantic Council’s Geoeconomics Center.
” In , such a world, the dollar would remain prominent but without its outsized clout, complemented by currencies such as the Chinese renminbi, the euro, and the Japanese yen in a way that’s commensurate with the international footprint of their economies”, Tran says.
According to Tran, “how Saudi Arabia approaches the petrodollar continues to be a significant predictor of the financial future as its creation occurred fifty years ago.”
This week in Moscow, that potential future is on full display. Officials in Washington ignore those machinations at their own risk, 800 kilometers away.
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It’s going to be a active, anxious and challenge-laden International Monetary Fund meeting in Washington this month.
There, the financial glitterati will fight a bewildering range of hot-button issues ranging from China’s decline to Germany’s crisis to geopolitical risks everywhere to a toss-up US election that’s screening nerves everyday. Put in the IMF’s instructions about a US$ 100 trillion people loan timebomb.
Amazingly, Washington may become hosting this week’s following most powerful economic gathering. Moscow, home of the BRICS countries ‘ yearly mountain, will host the more enthralling event.
Some experts predicted that the gathering that gathered Brazil, Russia, India, and South Africa would end up being a show just a few decades ago. In 2001, then-Goldman Sachs scholar Jim O’Neill coined the BRIC acronym. In 2010, the four original users added South Africa.
In the decades since, the BRICS seemed to reduce forward thrust. In a 2019 review, Standard &, Poor’s said the union had lost importance.  , Around that same day, O’Neill himself took some photos at his design.
O’Neill recently wrote that” the divergent long-term financial direction of the five states weakens the scientific value of viewing the BRICS as a clear economic grouping.” Based on the obvious debacle of the Portuguese and Soviet economies in the current century since 2011, where both have plainly performed significantly under-perform compared to what the 2050 scenario route laid out, I have often joked that I should have called the acronym “IC” .
However, the BRICS have since recovered some of their momentum and are now adding five more people. This year, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates may join the slide.
Mariel Ferragamo, an scientist at the Council on Foreign Relations, information that” the addition of Egypt and Ethiopia will intensify voices from the African continent. Egypt even had close business ties with China and India, and social ties , with Russia”.
As a fresh BRICS part,  , Egypt” seeks to , get more investment , and increase its damaged economy”, Ferragamo information. ” China has long courted Ethiopia, the third-biggest business in sub-Saharan Africa, with , billions of dollars of investment , to make the region a hub of its Belt and Road Initiative. The addition of Saudi Arabia and the UAE would send in the , two biggest economies , in the Muslim world and the next and eighth major oil producers internationally”.
The schedule of this growth dovetails with a major BRICS plan: de-dollarization.
The BRICS announced plans to create a “multilateral online lawsuit and pay system” called BRICS Bridge in February, which “would help bridge the gap between the financial markets of BRICS member countries and promote joint trade.”
According to reports, the gathering this week will use a new strategy to make efforts to replace the US dollar more quickly. Udith Sikand, an analyst at Gavekal Dragonomics, notes that one idea is for a gold-backed BRICS monetary unit.
According to Sikand, it seems unlikely that any single currency could get past this compulsion to completely replace the US dollar’s central role.
However, it is possible that a wide range of currencies could collectively chip away at their outsized role in an increasingly multipolar world. The logical consequence of a change would be that while the dollar is still important to global trade and capital flows, its ability to serve as a safe haven in stressful times would be diminished as investors weigh up their options among a myriad of alternatives.
And for that, the West needs to understand how much it makes things easier for the BRICS. After all, the Bretton Woods gang’s messing up their individual economies and, consequently, the global system contributes to this opening for the Global South countries.
Take the US, which is rife with political chaos at a time when the nation’s debt is over$ 35 trillion. The risks posed by the upcoming , November 5 election alone have credit rating companies on edge, particularly Moody’s Investors Service, which is the last to assign Washington a AAA grade.
Germany is flatlining, highlighting headwinds bearing down on the broader continent. As Germany’s Economy Ministry puts it, “economic weakness likely continued in the second half of 2024, before growth momentum gradually increases again next year”, adding that “technical recession” risks abound.
The European Central Bank’s decision last week to slash rates for the third time this year can be seen as a sign of the level of concern.
This increase in the rate of rate cuts is justified, according to Michael Krautzberger, global chief investment officer at Allianz Global Investors, because the combination of sub-trend euro growth and target inflation supports a much less restrictive monetary policy than is currently the case.
Krautzberger adds that” there are some hopes that recent Chinese policy support will help trade-sensitive markets like Germany, but we doubt that will be sufficient to offset the region’s weak domestic demand picture.” There is also a chance that trade disputes will return to the policy agenda after the upcoming US elections in November, adding to the risk of negative growth.
Making matters worse, according to the US and China’s public debt levels are projected to reach$ 100 trillion this year, in large part due to the country’s borrowing patterns.
” Our forecasts point to an unforgiving combination of low growth and high debt – a difficult future”, says IMF managing director , Kristalina Georgieva. Governments must work to reduce debt and rebuild buffers in anticipation of the upcoming shock, which may occur sooner than anticipated.
The world financial system is in immediate danger of such unthinkable debt levels. In a recent report, IMF analysts wrote that “higher debt levels and uncertainty surrounding fiscal policy in systemically important countries, such as China and the United States, can lead to significant spillovers in the form of higher borrowing costs and debt-related risks in other economies.”
These spillovers could make monetary policy decisions in both Asia and the world more difficult.
Officials from the Bank of Japan are declaring their intention to keep raising rates in Tokyo. Yet that’s despite data showing renewed weakness in retail sales, exports, industrial production and private machinery orders. and concerns among Ministry of Finance officials that deflationary forces might return in the months to come.
Even though inflation is easing in Japan,” the central bank has made clear that it will raise interest rates”, says Danny Kim, an economist at Moody’s Analytics. ” At best, this will slow growth. At worst, it could trigger a wider economic decline”.
All of this raises the question of whether the world’s leading economies are complacent about potential dangers.  ,
As officials arrive in Washington, there’s considerable relief that the US has n’t experienced the recession that the vast majority of economists predicted. Or that China’s downshift had n’t pushed mainland growth too far below this year’s 5 % target.
However, one might assume that this is the last blip before the storm. The geopolitical path is as dangerous as they can get. Middle East tensions are rising as Russia’s war against Ukraine drags on, aside from the ominous debt milestone that the IMF has flagged. And then there’s the return of the” Trump trade”.
Polls indicate that Kamala Harris and former US President Trump are in a very close race. The betting markets, though, suggest Trump might prevail. If so, Asia could quickly find itself in harm’s way.
Trump’s threat to slap 60 % tariffs on all Chinese goods is just the beginning. Many people predict that a Trump 2.0 administration will impose much higher taxes and trade restrictions, wreaking havoc on Asia in 2025.
Even if Trump loses to Harris, he’s hardly going to accept defeat and move on peacefully. Many people are already concerned that their candidates ‘ supporters may stage a second invasion of the US capital to protest their election defeat. That’s likely to imperil Washington’s credit rating anew and spook investors pushing Wall Street stocks to all-time highs.
The fallout from the Trump-inspired January 6, 2021 insurrection was among the reasons Fitch Ratings revoked its AAA rating on US debt, joining Standard &, Poor’s. The question now is whether Moody’s downgrades the US, too.
This uncertainty is influencing the BRICS’ positions. Southwest Asia is also clearly orienting itself toward the BRICS countries.  , All this is a global game-changer that few in the West saw coming.
Earlier this year, Malaysia detailed its ambitions to join the intergovernmental organization. Thailand and Vietnam are also interested in joining the Association of Southeast Asian Nations, which is a group of nations. In Indonesia, an increasing number of lawmakers are BRICS curious, too.
The involvement of Southeast Asia could have a significant impact on Joe Biden, the president of the United States. Since the Biden era, a regional bulwark has been built to counteract China’s growing influence and attempts to replace the US dollar in trade and finance.
The BRICS phenomenon demonstrates a growing stutter in relations between the US and many ASEAN members. This, at a time when , Saudi Arabia , is looking to phase out the “petrodollar”. As China, Russia, and Iran square off against old alliances, Riyadh is making more efforts to de-dollarize.
” A gradual democratization of the global financial landscape may be underway, giving way to a world in which more local currencies can be used for international transactions”, says analyst , Hung Tran at the Atlantic Council’s Geoeconomics Center.
” In , such a world, the dollar would remain prominent but without its outsized clout, complemented by currencies such as the Chinese renminbi, the euro, and the Japanese yen in a way that’s commensurate with the international footprint of their economies”, Tran says.
Tran points out that “in this context, Saudi Arabia’s approach to the petrodollar continues to be a significant harbinger of the financial future as its creation was fifty years ago.”
This week in Moscow, that potential future is on full display. Officials in Washington choose to ignore those plots located 800 kilometers away at their own risk.
Follow William Pesek on X at @WilliamPesek
