U.S.-China decoupling is impacting a wide range of industries. Supply chains in the semiconductor, rare earths, pharma and battery sectors, for example, have been slated for strategic re-shoring within the confines of the U.S., Europe, Japan and beyond.
But the global financial sector—which is undergoing a revolution in digital payment technologies and other fintech-enabled commerce—could soon face its own decoupling scenario. This is a corollary of techno-nationalism and it is being accelerated by the development of central bank digital currencies (CBDCs).
As part of its 14th 5-year plan, for example, China is investing massively in R&D and infrastructure for a digital currency. The e-CNY, or e-yuan, figures to play a critical role in the Chinese Communist Party’s domestic affairs and in the pursuit of its geopolitical interests.