Overview
- Ruchir Sharma argues the United States is winning the financial contest with China, calling Beijing an "incomplete superpower" that runs 30 to 40 years behind past leaders.
- China’s currency remains underused globally, with the yuan near 2% of central‑bank reserves and trade invoices, while the dollar dominates reserves, invoicing, and most foreign‑exchange trades.
- Sharma ties the shortfall to strict capital controls that keep savings inside China and leave foreigners holding less than 5% of the country’s stocks and bonds.
- Recent steps show only modest gains, including $16.4 billion in People’s Bank of China swap lines by end‑March and the yuan moving to fifth in SWIFT’s global payment rankings.
- The dollar’s reach lowers U.S. borrowing costs and enables financial sanctions, and analysts say China would need a far bolder opening to mount a credible challenge.