From our Swindon correspondent:
I thought I’d write a series of general predictions about the post-Covid-19 world. For anyone who saw the world before the last major global event, the attacks on New York on September 11 2001, there were undoubtedly changes, both short term and long.
Most articles making predictions have people coming at it from a wishful thinking perspective. Men of god are predicting we’ll all be more religious, commies more communism.
One of the strongest voices is the autarky fanboys who want us to stop trading with China at the end of this. They’ll mention human rights abuses, wet markets and the response to Covid-19, but it’s always the same story with these people. In an earlier age they would have been complaining about counterfeiting and quality, like the line from The Magnificent Seven by The Clash: “give me Honda, Sony, so cheap and real phony”. Although anyone who owned a Honda in 1980 would have had a better experience than a Morris Marina. China is just the grand fromage of imports now. When the autarky types stop China imports, they’ll go after the next big guys.
Personally, I think in general that not only is this a bad thing for us financially (who wants to spend more on their USB cables), but bad for China and bad for things like reducing the spread of infectious disease. All the “good society” things like democracy, free speech and open government come after industrialisation. That’s how Taiwan, Korea and the UK got them, and I think China will be the same. More wealth also improves what people eat. They stop eating random wild animals to stop them going hungry. In recent years, outdoor markets have been declining in favour of supermarkets in China, and that’s the result of industrialisation.
I predict there’s going to be a lot of sabre-rattling about China exports, perhaps a few token gestures, but not a lot of real action. There’s a constituency for this sort of talk, many of us even like the idea of more factories in Scunthorpe making iPhones, until we’re shown the price, at which point, we tend to put the union jack away and quietly buy the Chinese alternative. And the politicians know this. I think in areas such as medicine, we’ve had a wake-up call about protecting supply, but I think that applies wider than China after France and Germany blocked exports.
There might be some onshoring by business buying goods, but I think it will only be at the margins. Business will reassess the risk of offshore higher and where the price difference is insignificant, buy British. Again, that might be wider than China.
I think tourism to China is one of those “marginal shifts”, too. People have plenty of other places they’d like to go, and it’s going to take a long time for confidence to be restored to this.