S1 2026 Individual Assignment 2 Topic A

Choose only one topic. You can choose either Topic A or Topic B.

Each topic is linked to two longer media articles that reflect different approaches to the

challenges facing globalizing Chinese enterprises. In a first step, compare how these two

articles approach the topic and what solutions they propose. In a second step read the two

articles in the context of the academic articles. From this broader perspective, consider how the

two media articles relate to the underlying issue of the future of globalisation.

You must reference at least these two academic readings (see Canvas Reading List):

Vertinsky, I., Kuang, Y., Zhou, D., & Cui, V. (2023). The political economy and dynamics of

bifurcated world governance and the decoupling of value chains: An alternative

perspective. Journal of International Business Studies, 54(7), 1351 – 1377.

Altman, S. A., Bastian, C. R., & Fattedad, D. (2024). Challenging the deglobalization narrative:

Global flows have remained resilient through successive shocks. Journal of International

Business Policy, 7(4), 416-439.

The structure of your critical reflection

1. Short introduction of one sentence or so, stating the question you want to answer and

why it is relevant.

2. In the first step, students are asked to critically compare the two media articles with

their different perspectives and reflecting on the intent of the articles, background,

specific arguments and points of agreement and disagreement. You are welcome to

prompt Copilot or a USYD approved AI software to compare the two articles along the

above criteria. If you choose this path, you must add your own evaluatiuon of the AI

generated comparison.

3. For the second step, consult the academic readings and the lecture content and

analyse the media articles against this background. For example, you may find that the

two media articles, even with their different viewpoints, only cover superficial or limited

aspects of underlying issues discussed in the academic writings.

This step relies on your own individual critical understanding of the subject matter

acquired through your own study and research. This second step is the main analytical

part where you can show your intellectual understanding. AI will be of little use for this

analytical part. AI use is not recommended here and is easily detected when marking.

4. Short conclusion of a few sentences, summarising your answers to the question raised

in the Introduction.

The total word length is 1,250 words. The word length for the individual sections is indicative.

1. Short Introduction: (50 words)

2. Comparison of two articles (500 words)

- Summary of the AI assisted comparison (200 words)

- Your own evaluation of the comparison (300 words)

3. Your analysis of how the articles relate to lecture content and academic readings (500

words)

4. Short conclusion: (50 words)

Article 1

https://www.mckinsey.com/capabilities/geopolitics/our-insights/robert-lighthizer-on-the- future-of-global-trade

The former US trade representative argues that the global trade system needs an overhaul.

4 December 2025

McKinsey & Company

Ziad Haider: Let’s start with the US–China relationship. There was an important meeting

recently between Presidents Trump and Xi on the sidelines of the Asia–Pacific Economic

Cooperation summit. We saw what some would call an uneasy truce in the long-running trade

dispute. What do you think of the deal they reached, and what should business leaders be

watching for in the aftermath of that meeting?

Robert Lighthizer: My view is that China and the United States are both trying to achieve the

same thing. China expects to be number one in the world, which it thinks is its rightful place,

and the United States feels the same way about itself and the Western system in general.

There’s an adversarial relationship between the two countries, and I believe we’re now in a

second cold war. The important thing is to keep it a cold war.

I don’t believe an agreement can resolve the two countries’ fundamental differences. On the

one hand, you have a Marxist Leninist totalitarian government that wants to impose a new

system on the world. On the other hand, you have the West’s liberal democratic, fairly open

economic system. What you will have are truces, and that’s what this was. It reduced tension,

which is the most you can hope for.

In general, I think the US administration has been taken aback by the extent of the choke points

China created over the years. I also think China made a mistake by imposing a new system

requiring its approval to export products containing Chinese rare earth minerals between third- party countries. It was an overreach. It’s up to the West now to ensure we eliminate as many of

these choke points as possible. China, of course, is doing the same. Since at least 2006, the

government has been trying to reduce the country’s dependence on Western technology.

Red, yellow, and green lights of China engagement

Ziad Haider: You talked in the past about the United States’ “strategic decoupling” from China.

To use a traffic light analogy, where do you see red lights for companies that still operate in

China—areas where they can no longer engage? What about yellow-light areas, where they can

proceed with caution? And, since you’re not calling for a full decoupling, are there areas where

you would give a green light?

Robert Lighthizer: We ought to have trade, but it ought to be balanced. We shouldn’t be

transferring wealth to China. I also think the US government should regulate investment in a way

that benefits the West or the United States.

In terms of red lights, I believe that includes anything involving national security. But I would go a

step further and add anything involving technology, because an extremely high percentage of all

technology is dual use [military and civilian] or will become so. It’s not always possible to

predict which technological advances may have future military applications. That was

demonstrated during the George W. Bush administration. President Bush didn’t view extreme

ultraviolet lithography as a technology that warranted protection. Now we know that it’s

absolutely fundamental to the production of advanced chips. I would also include data in the

red-light category because it’s so important for training AI models.

In terms of yellow lights, I would say high-level manufacturing. In green lights, I’d include

agriculture and low-tech manufacturing. Obviously, China needs raw materials and agriculture,

and letting the country supply low-tech materials to the West is a good idea. But you need to

think in terms of the national security implications as well as the broader economic

implications.

A good example of the latter is how Europe’s automobile industry finds itself under assault from

China. Chinese car companies are starting to take over the European market. [Nonelectric]

automobiles have high-tech elements, but generally they’re not high tech. Yet, they’re so

fundamental to the European economy that if it loses that industry—or if the United States lost

it—it would be a catastrophe. As recently as five years ago, most industry experts thought it

impossible for Chinese imports of European cars to decline, yet Chinese car companies are

now taking over their domestic market. While economic security has to be protected, there’s an

element of national security involved as well.

Ziad Haider: I’m based in Singapore, which lies in a region that has played a key connective role

between the United States and China. One major regional question concerns the Trump

administration’s expectations around reduced reliance on Chinese supply chains. For example,

the trade agreement reached when the US president was in Malaysia included economic

security provisions vis-à-vis China. How do you view these efforts?

Robert Lighthizer: I think about them in two ways. One is in terms of supply chains, and the

other in terms of transshipment, the routing of goods through third-party countries to avoid

higher tariffs.

If you look at Vietnam, Thailand, and to some extent Mexico, you will find some imports from

China exported under the radar to the United States to avoid higher tariffs. One provision agreed

to in Malaysia—which I think will become universal before too long—is that transshipped

Chinese content must face a high tariff. The technology to determine the true origin of goods

will need to be developed in the future, but the need to stop transshipment is clear in my view.

This focus is also timely because, while China’s exports to the United States are declining, its

exports to countries that ship to the United States are rising.

The supply chain question is a little different. Critical supply chains ought to be domestic or

with close allies, and I think you will see movement in that direction. The less critical supplies,

which are often low tech, can be sourced from a variety of places and moved quickly if a choke

point is created, so they are less of a problem.

Ziad Haider: What do you think about the new trade corridors that are emerging? Are there any

that you are keeping an eye on?

Robert Lighthizer: First, I think you will see companies try to adapt within their own trade

corridors rather than making wild changes. The United States is likely to operate within its own

hemisphere—Mexico is one of the transshipment concerns, but the Mexican government seems

to understand this. The trade patterns at risk are the ones that lead to imbalances. That is

obviously trade with China and other parts of Asia.

The issues with the World Trade Organization [WTO] is that it doesn’t—and probably can’t—deal

with nontariff barriers, such as labor laws, currency manipulation, banking laws, and

environmental regulations or lack thereof. These barriers are a reflection of how you organize

your society. China and some other countries are organized in a way that will always produce a

trade surplus. In past WTO negotiations on tariffs, when we got the Tokyo and Uruguay rounds,

we tried to get into nontariff barriers. But I think it was a mistake to think you could negotiate

them, because countries can come up with new ones the minute you’ve resolved an old one.

I believe we need a system based on global balance, not bilateral balance, which wouldn’t work.

That’s likely to be the direction that global trade moves in, rather than small issues.

Global trade watchlist for 2026

Ziad Haider: Looking ahead, we have a US Supreme Court ruling on the president’s ability to

impose tariffs and the United States–Mexico–Canada Agreement [USMCA] coming up for review

and adjustment. What other issues on the trade front should we keep an eye on in the year

ahead?

Robert Lighthizer: Those two are big. Another issue to keep an eye on is Europe’s relationship

with China. It has reached an inflection point. It’s changed from being one that was massively

favorable to Europe to one that’s heading in the direction of being very unfavorable to Europe,

and I don’t think Europe can tolerate that.

It’s also worth reminding ourselves that most of these imbalances are not the result of

fundamental economics but of industrial policy. That makes a huge difference. If it were

fundamental economics, you would take one series of approaches. When it’s industrial policy,

you need government measures that neutralize the unfair advantage other countries have

created.

Ziad Haider: You counsel boards and management teams today. What no-regrets moves would

you recommend to boards them to navigate the geoeconomic volatility?

Robert Lighthizer: I’ll answer that as President Trump would: If you want to avoid trade

regulations affecting your business, then you should manufacture close to your consumer base.

That’s simple, and I think you will see more manufacturing closer to consumption and shorter

and less complex supply chains. I also think companies will diversify their manufacturing, so

instead of manufacturing for the entire world from one location, they will manufacture in

different places.

Article 2

https://en.chinadiplomacy.org.cn/2026- 04/28/content_118466767.shtml#:~:text=Within%20these%20policy%20frameworks%2C%20 %22de,edge%20in%20the%20global%20economy.

Decoupling from China proves harder than Western policymakers expected

Source: chinadiplomacy.org.cn | 2026-04-28

By Li Xing

Lead: Despite years of U.S. and European efforts to reduce reliance on Chinese manufacturing,

China has maintained and, in some respects, deepened its structural role in global supply

chains.

Since Donald Trump’s first term as U.S. president, curbing China's economic and technological

rise has become a central priority for policymakers in both the United States and the European

Union. This shift has been accompanied by the emergence of several new policy concepts, such

as "decoupling," "de-risking," "de-globalization" and "re-globalization," which reflect evolving

strategies toward China's role in the global economy.

Within these policy frameworks, "de-globalization" carries an implicit meaning closely aligned

with decoupling or de-risking. It signals an effort by Western economies to reduce dependence

on Chinese manufacturing, trade networks and supply chains in order to undermine China's

competitive edge in the global economy.

Conversely, "re-globalization" reflects not a retreat from globalization itself, but an attempt to

reshape it. The goal is to redesign global economic structures — particularly in high-tech

sectors and strategic industries — in ways that reduce dependence on China and reorganize

supply chains around “trusted” partners. In this sense, re-globalization points to a new phase of

globalization characterized less by efficiency-driven integration and more by strategic

competition against China. Together, these ideas illustrate a broader transformation:

globalization is not ending, but being reconfigured under the pressures of geopolitical rivalry,

with China at the center of this reordering.

The policy agendas built around these concepts, however, have so far failed to significantly

diminish China's central role in global manufacturing and supply chains. Recent evidence

suggests that China’s position has proven resilient and, in some respects, structurally

embedded.

A key explanation comes from a 2024 U.S. Federal Reserve report titled “As the U.S. is Derisking

from China, Other Foreign U.S. Suppliers Are Relying More on Chinese Imports.” This report

demonstrates that although the U.S. has reduced its direct imports from China, it has

simultaneously increased imports from third countries that are themselves more reliant on

Chinese inputs. In effect, dependence has not been eliminated but rerouted: China's role has

shifted upstream in global value chains, with its components and intermediate goods

continuing to flow indirectly into U.S. imports. These dynamics highlight the limits of "de-risking"

when supply chains remain deeply interconnected.

A central insight is that these third-party suppliers increasingly use Chinese intermediate goods

in their own production. The report notes that as their share of imports from China rises, so too

does the Chinese value-added content embedded in the goods they export. This means that

even when the U.S. imports from alternative partners, those imports often still contain

significant Chinese inputs, effectively preserving China's role within the supply chain.

Empirical data across major U.S. partners, including Canada, Mexico, Germany, Japan, South

Korea and Vietnam, support two key findings. First, these countries have generally increased

their own reliance on Chinese imports over time. Second, the U.S. has shifted its sourcing

toward countries that already have stronger trade linkages with China.

A complementary perspective from a European policy report, "How China is de-risking better

than Europe," echoes these findings: while the EU has struggled to articulate and implement a

coherent de-risking strategy, China has been more effective in reducing its own vulnerabilities.

Through long-term diversification of markets and resources, expansion into the Global South

and coordinated industrial policy, China has strengthened its resilience even as Western

economies attempt to rebalance away from it.

The report argues that China has been more effective than Europe in mitigating risks to its

economic and strategic position, largely because it has pursued a long-term, coordinated and

comprehensive approach, whereas the EU's efforts remain fragmented and reactive. A key

finding is that Europe's concept of "de-risking," introduced in 2023, has lacked clarity in both

strategy and implementation.

While EU leaders identified the so-called vulnerabilities — such as dependence on China in

critical technologies and supply chains — policy responses have been slow, inconsistent and

often counterproductive. In several cases, including energy and semiconductors, Europe has

merely shifted dependence from one dominant supplier to another rather than genuinely

diversifying risk.

In contrast, China has pursued risk mitigation through decades of deliberate policy. Its strategy

centers on diversification: expanding export markets beyond the U.S. and EU, securing multiple

sources of energy and raw materials, and strengthening domestic demand through the "dual

circulation" model. At the same time, China has reduced exposure to Western financial and

technological pressure while increasing engagement with the Global South via investment and

diplomacy.

Another central argument is that China's success stems from a holistic approach to national

security, which integrates economic, technological, political and military policy under

centralized coordination. This allows China to anticipate and manage external shocks — such

as trade wars or sanctions — more effectively than the EU, where decision-making is slower and

more fragmented. The report concludes that China's coordinated diversification and long-term

planning have made it more resilient to global economic and geopolitical risks.

Faced with intensifying strategic competition and a shifting global landscape, China is

navigating a dual imperative that is both defensive and proactive. On the one hand,

consolidating its structural position means reinforcing the foundations that made China central

to the global economy: its manufacturing depth, infrastructure, supply chain integration and

scale.

This involves cultivating new quality productive forces by upgrading industrial capabilities,

especially in advanced manufacturing, reducing vulnerabilities in critical technologies and

strengthening domestic demand. It also requires maintaining its role as a key hub in global

supply chains despite external pressures such as tariffs, export controls and investment

restrictions from the U.S. and its partners.

On the other hand, China is not merely reacting; it is actively seeking to shape the contours of

the emerging economic order. This includes expanding economic ties with the Global South,

promoting alternative trade and investment frameworks, and setting standards in next- generation technologies such as AI, green energy and digital infrastructure. Such initiatives

reflect an ambition to shape globalization's reconfiguration rather than be constrained by it.

Recent data show that China has effectively mitigated the impact of Western de-risking by

expanding its trade ties with the Global South. China's exports to these countries reached

approximately $1.6 trillion in 2024, more than 50% higher than its combined exports to the U.S.

and Western Europe. Driven by trade diversification and programs such as the Belt and Road

Initiative, China's economic engagement has increasingly focused on regions including Africa,

Southeast Asia and the Middle East. By 2025, trade with Belt and Road partner countries

accounted for 51.9% of China's total trade.

China's experience demonstrates that effective risk management is not synonymous with

disengagement, but with abiding by objective economic laws. Through long-term diversification,

industrial upgrading and the expansion of South-South economic and trade linkages, China has

not only mitigated external vulnerabilities but reinforced its structural embeddedness in global

supply chains and value chains.

Rather than being displaced or replaced, China has moved upstream, deepening its role as a

provider of intermediate goods and a coordinator of production networks. In this sense, China

continues to function as a centripetal force in the global economy, drawing production, trade

and investment into its orbit, thereby making sustained contributions to the stability,

predictability and growth of the global economy. When China advocates win-win cooperation

and inclusive, shared economic globalization, perhaps it is more than mere rhetoric.

Li Xing is a Yunshan Leading Scholar and director of the European Research Center at the

Guangdong Institute for International Strategies, Guangdong University of Foreign Studies. He is

also an adjunct professor of international relations at Aalborg University in Denmark.

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