Venezuela is not Taiwan in terms of

China's core interests. It is a

important strategic foothold uh for

China in Latin America. I mean, it was

described as an all-weather strategic

partnership back in 2023. So, this was a

critical relationship that has, I think,

been [music] weakened with the Trump

administration's move.

[music]

Welcome to China Decode. I'm Alice Han

>> and I'm James King. In today's episode

of China Decode, we're discussing how

China will respond to Trump's takeover

of Venezuela, a turning point in the

electric vehicle race, and China's

luxury food boom. That's all coming up.

But first, let's do a quick check-in

with how the Chinese markets are

starting the week. On Monday, the

Shanghai Asshare index rose 1.4% on its

first trading day of the year. The

Hangshare index rose less than 0.1%

hovering near a 7-week high. Oil

companies Petrochina and China National

Offshore Oil Corporation both fell more

than 3% due to their ties to Venezuela.

And Miniax, a Shanghai based AI company

backed by both Alibaba and Tencent, is

expected to begin trading on the Hong

Kong stock exchange within the week at

an IPO valuation of $6.5 billion. All

right, let's get right into it. China

just watched the US pull off a lightning

strike and takeover in Venezuela,

removing the leader Nicholas Maduro and

threatening to take some control over

the nation's oil industry. Now, this

happened just hours after Beijing's top

envoy was sitting with Maduro himself.

Now, this timing could be accidental or

it could be the opposite. But for China,

Venezuela isn't just an ideological

ally. It is a significant energy

supplier, a major data, a strategic

foothold in Latin America and a test

case for pushing against US dominance in

the Western Hemisphere. A day after the

US operation, the Chinese Foreign

Ministry declared itself quote unquote

deeply shocked and strongly condemned

the flagrant use of force by the United

States against a sovereign state. So the

real question now isn't so much whether

China is angry, it's how it will

respond. Will Beijing swallow the loss

and play the long game? Or does Trump's

move force China to harden its posture

elsewhere from Latin America to Taiwan

or even the South China Sea? What

happens next could tell us a lot about

the shape of US China relations in 2026?

James, I'm very excited to be talking

about this for the first episode of the

year. I want to hear your takes before I

dive into mine. What's what's your view

on this?

>> Well, Alice, I mean, you know, when it

rains, it pours.

um the the new year starting off like

this. Uh there really couldn't be a

bigger geopolitical question for China

than how it reacts to this. And I think

you framed it perfectly. Is it going to

play the long game or are we going to

see some retaliation

uh pretty much straight off potentially

even military retaliation? Now, I'm not

going to duck the question. I'm going to

go straight in there. Um, of course, we

can't know the answer. Such things are

among China's most closely guarded

secrets. I think that we will not see a

military retaliation from China on

Taiwan or in the South China Sea, at

least not in the short term. I think

that what you framed as China playing

the long game is a much more uh likely

scenario. And the reason I think that is

because Taiwan considerations

are in the background of China's

reaction to this. Venezuela is a long

way from China. It's a long way from

Taiwan. But just let me try and sketch

out why I think Taiwan and and and

China's reaction to Taiwan is crucial in

this geopolitical shadow play that we're

watching. I think that the way in which

the US framed its move on Venezuela as

part of its uh attempts to shore up its

backyard to concentrate on what both

Trump and Marco Rubio described as the

Western Hemisphere. I think that that

may give China a ray of hope or at least

cause to wait and see whether the US is

really serious about concentrating its

geopolitical attention onto the Western

Hemisphere, which of course doesn't

include Taiwan or China, and thereby

move away or shift the focus of its

geopolitical reach away from China's

sphere of influence.

And so I think if that does turn out to

be the case, we may well see China

taking a longer view on this and

although yes, some of China's

condemnations um have been fairly

strong, I also think that uh other

statements by the Chinese so far give

the sense that China is really waiting

uh to see. The two pieces of reasoning

that I advanced to support my point of

view is that the national security

strategy which the US released in

December last year identifies the

western hemisphere as the vital interest

of the US and it drops language from the

Biden presidency that identified China

as America's most consequential

geopolitical challenge. Um, it also

doesn't even mention great power

competition at all with China and it

also downgrades the status of Taiwan.

Um, in the past under Biden, it used to

say that the US was opposed to a shift

in the status quo of Taiwan. But the new

uh national security strategy unveiled

in December last year in the US says

that it quote does not support a change

in the status quo of Taiwan. This is

seen as a clear downgrading of the

importance and sensitivity of the Taiwan

question. So my response is I think that

China is hopefully waiting to see the US

redefine its geopolitical focus to its

own backyard i.e. Latin America and in

this case Venezuela in particular and

thereby shift away from Taiwan and those

contentious areas the South China Sea

and China itself. And if that happens,

it will give China breathing space to

advance its biggest priority in terms of

geopolitics. But this is really hard to

call at the moment, Alice. I'm really

interested in your take on it. So, how

do you see it?

>> Well, very quickly on the geopolitical

front before I talk about some of the

economic consequences which are worth

delving into as well. uh is is it's

interesting that uh you know we talk a

lot about the the Trump's approach is

the Roosevelt crawler into the Monroe

Doctrine. Uh to borrow another Roosevelt

analogy uh I think China's approach to

this after seeing what happened in

Venezuela is going to be uh to speak

softly and carry a big stick. And what I

mean by that is on one hand it will

continue I think to pursue some kind of

trade day to to try to soften some of

the edges the rough edges in the

relationship. Uh I think that they were

heartened by the national security

strategy document that you referred to

James not being an attack a direct

attack on China as it had been in

previous administrations. But at the

same time you know massively uh

increasing its investments uh and

deployment of its military capabilities.

We saw that in in full display a couple

months ago at the September parade. So I

think we'll have a two sort of two-track

approach to this relationship and

towards China's geopolitical strategy.

But it it is worth mentioning, James,

that even although Venezuela is not

Taiwan in terms of China's core

interests, it is a important strategic

foothold uh for China in Latin America.

I mean, it was described as an

all-weather strategic partnership back

in 2023. That's sort of the second tier

in terms of what we think about uh in

terms of friendships that China has with

the rest of the world. So, this was a

critical relationship that has I think

been weakened with the Trump

administration's move. And we if we

think about the economic implications as

well, it's not so much about oil because

only about 5% of China's seaborn crude

imports come from Venezuela. It's more

about uh the debt that's outstanding. So

we have still by some estimates around

$10 billion if not more of debt

outstanding that Venezuela owes to

China. And a lot of that traditionally

from Chavez onwards to Maduro was in the

form of loan for oil deals. that I think

is going to be subject to debate whether

or not Chinese creditors are going to

get a haircut or they're going to have

to miss a lot of the debt that's owed

because fundamentally uh Venezuela I

think is going to have to listen to the

Americans uh at least in the short term

in terms of some of these debt

restructuring and and oil developments

in the region. So I think for from

China's vantage point this is a net loss

certainly but I agree with you James if

we broaden it out I don't think this

materially increases China's uh designs

to invade or blockade Taiwan I think if

if I'm in Beijing watching this I would

tread carefully because the Trump

administration has shown that it has the

military muscle to fight in areas that

it deems to be in its national core

interests which in in this

administration is about the western

hemisphere. So, if I'm Xi Jinping

sitting in Beijing, I'm going to sit

tight a little bit and see what the

Trump administration is going to do uh

in its second half of a lame duck

presidency because remember, we have the

midterms coming up. A lot can change

domestically that can also transform and

alter Trump's uh geopolitical strategy.

>> Absolutely. I think uh one of the one of

the first indicators that we're going to

get of the trajectory of China US

relations after uh this move in

Venezuela is whether or not uh Trump's

meeting with Cining which is supposed to

take place in April actually goes ahead.

Um if we start seeing that you know that

meeting is called off or or people are

talking about rescheduling a meeting

then I think it will be a sign that

things are going badly wrong uh in the

US China relationship perhaps partly

because of these tensions and losses

that China is going to suffer over

Venezuela. But if China gets a sense

that there is something to play for on

its crucial priority of Taiwan i.e. a

softening of the US position on Taiwan,

then I would expect China to be pushing

full steam ahead for that meeting to go

ahead.

>> Yeah, I agree. I think that will be the

next litmus test uh in April if the two

presidents meet and whether or not

Taiwan is on the table, so to speak. And

I'm sure that the Chinese will be

testing the Americans to see to what

extent uh the Trump administration is

willing to sacrifice uh blood and

treasure for a Taiwan campaign, which at

least to my mind when we when I think

about the Trump uh clan and the people

around Trump, I mean, including frankly

uh Rubio as Secretary of State, it

doesn't seem to be a top priority. I

think that the focus in this

administration is very much on Latin

America, on defending the Western

Hemisphere as opposed to uh being

embroiled in conflicts overseas. I

wanted to talk a little bit about some

of the economic implications for some of

the players in China because, you know,

we've heard on Monday that the NFRA, the

National Financial Regulatory

Administration, is telling the banks

that it needs to release its exposure to

Venezuela. It's still unclear when I was

digging into the data to the extent to

which the policy banks and banks uh in

China are exposed to Venezuelan debt.

When I look at the numbers since 2007,

uh you have over hundred billion in

loans that were lent to Venezuela uh to

help with infrastructure, to help with

oil. What's your take on this? Uh have

you been following this, James? Yeah, I

mean I I used to write a lot about China

Venezuela because Venezuela was the

poster child of the Belt and Road

initiative um launched by China around

2012 in Latin America. It was the number

one borrower um among Latin American

countries from China and China was

building all kinds of infrastructure in

Venezuela. There were factories,

railways, roads. It really was a

showcase of what China could do and

China wanted to show the whole region.

And I remember back in the days of

former President Hugo Chavez in

Venezuela talking about the alliances

between China and Venezuela as like a

great wall of friendship that obviously

we were supposed to read in would sort

of keep the Americans out. And so as you

rightly say Alice, Venezuela has been

really crucial for China. but less so

recently. And as you've already sketched

out, I think if we boil it down to uh

brass tax, I think China stands to lose

about 10 billion US uh in loans that are

not repaid if the deal doesn't go to its

advantage. And also there's a potential

that it could lose around 2 billion in

terms of investment that was intended by

Chinese companies in the Venezuelan oil

sector that may now not go ahead. Those

are big numbers but they're not

catastrophic. Um, China is lent more

than$2 trillion US dollars as part of

its uh, belt and road initiative um,

according to aid data a US consultancy

over the last 10 or more years. So 10

billion it's a large number but it's not

catastrophic in terms of the general

reach of China's uh, development lending

around the world.

>> Yeah, I'm going to agree with that. I

think that the bigger implication is the

geostrategic one for China and Latin

America. And when we broaden it out to

China's allies or partners, you know, I

I feel very much that the access of ill

will has been weakened. Iran has been

weakened substantially by Israel over

the last few years. This is yet another

I think ally and partner for China that

has been weakened uh under this

administration. So, we'll have to see uh

what happens uh in 2026 with with the

rest of the players. Okay, we'll be back

with more after a quick break and stay

with us.

[music]

Welcome back. Tesla has just lost its

crown. The company sales fell 16% at the

end of 2025, hit hard by the roll back

of US EV tax credits. And for the first

time, China's BYD has overtaken Tesla as

the world's top electric car maker. It's

a sharp turn for a company that once

aimed to dominate global auto sales and

is now betting its future on

self-driving tech and robots. James,

let's go right into it. I have a lot of

opinions, but I want to get your take on

why BYD has over finally overtaken uh

Elon Musk's Tesla. It's not been a good

year for Elon Musk 2025, I have to say.

>> Yeah, I mean uh this is one of the great

corporate rivalries of our time. I mean,

it's rather like the Coca-Cola versus

Pepsi, Apple versus Microsoft,

McDonald's versus Burger King, but this

time it has an extra twist because this

is an American high-tech champion versus

a Chinese high-tech champion. And the

bare facts are that Tesla has lost its

global sales crown to BYD, the Chinese

uh car maker after almost a decade as

the world's bestselling EV brand. This

is because both BYYD's numbers were up

very sharply in 2025. They got a 28%

increase in global sales and Tesla sales

were down 8.6%

uh for the year. Of course, Tesla's

sales are down partly because of tax

changes in the US which removed an

incentive for American consumers to buy

uh Tesla cars. But more generally, I

think, and this is where I think the

main story is, BYD is steamrolling into

markets all over the world. um here in

Europe and I've actually driven one of

the BYD cars as it came off the first

shipment to Australia. There was a

massive ship transporter and about 5,000

BYD cars came off the ship and I I drove

one in 2024 in Bremen and I have to say

it took me a while to understand how to

use it. There were so many kind of

gadgets and dials and the car was

talking to me in German which I speak

very poorly. But after I got going, I

have to say it was a very smooth ride.

So, it's a piece of high technology. But

I think the crucial point is that the

BYD car that I was driving, which was

the Dolphin Surf, cost about 22 uh

23,000.

That's almost half the cost of the Tesla

Model 3. And I have to say the cars are

are, you know, comparable in terms of

their technology and their look. And I

think that fact lies behind why BYYD has

managed to record a million sales of

vehicles outside China uh last year.

That's up an incredible 150% from 2024.

So, I think Tesla is being beaten by a

cheaper car that looks kind of almost as

good and is technologically either on a

par with Tesla or even slightly better.

What's your opinion, Alice?

>> Well, at the risk of being contrarian,

James, I'm going to take the other side

of it and say that BYD may have peaked

and some of these EV players may have

peaked at least domestically in China.

You know, just to give people a sense of

the numbers, BYD sold 2.26 26 million uh

electric vehicles this year. Uh Tesla

sold 1.63 million. So that's quite a big

delta uh between the two players. But a

lot of it, James, I mean to your point

uh still is a domestic driven story. I

think the majority of EVs sold by BYD

still consumed by Chinese consumers.

That trend that in the last few years

has shifted. We're seeing more that are

going out. Um but we can also discuss

whether or not that is going to be an

ongoing trajectory given some of the

trade uh barriers that countries like

the EU uh for instance are putting on

China. But when I look at the domestic

outlook, what's interesting to me is

that the government just in the last

week or so has announced that it's going

to get rid of some of the tax waiver for

the purchase tax on EVs. So originally

there should be a 10% purchase tax.

There was a full 100% exemption of that

for a couple of years. As of this year,

it's going to be a 50% exemption. So,

effectively a 5% purchase tax on all

EVs. That could have a material impact

on whether or not you as a Chinese

consumer are going to buy a new vehicle.

But on the flip side, they've announced

uh at the end of December that they're

going to put in $ 8.9 billion ultra-long

special treasury bond issuance program

to fund tradein of EVs uh and subsidies.

So it could be that we could see after

March at the NPC meeting that there is

some more support uh for for existing EV

consumers trading in their old vehicles

and buying new ones. But you know we're

also seeing an economy that's still

trapped in some kind of deflation.

Consumers are not spending as much as

they the government wants them to. So

I'm still a little bit skeptical about

the growth trajectory domestically uh in

terms of demand for EVs. Uh, and then

when we factor in some of the headwinds

globally to Chinese EV providers, I'm a

little bit worried. Yes, I mean BYD has

a superior product. I was just in a BYD

vehicle uh a couple days ago in Sydney,

Australia. I'm seeing more of them on

the streets for sure, but I I I worry a

little bit about how this will be

perceived by foreign governments uh as

an influx of of cheap Chinese EVs. So,

I'm a bit skeptical. I'm holding my

breath to see if we're going to see

major legislation from countries around

the world to try to limit the amount of

Chinese electric vehicles cuz remember

autos is a huge political issue not just

an economic issue for a lot of countries

around the world. So I think this will

be an interesting thing to track

obviously when we think about the

broader Chinese uh overcapacity issue

and China's export engine. But one last

thing that I wanted to add which I

thought was super interesting again tied

to Elon Musk is that he tweeted a couple

days ago that uh China's silver export

controls are not good that because

silver is uh needed in many industrial

processes and I think people forget that

given that silver is a precious metal

but it is used it is used in cars for

instance in electric vehicles in solar

panels uh in AI data centers uh and you

know we've seen the creation of these

export controls to restrict the global

supply uh more recently of rare earths.

Silver has been added to that list. I

think this is important and worth

tracking because this also could have a

material impact on Tesla for instance on

other automakers because silver is still

an important input in into some of these

processes. And when I think about some

of the levers that China will use in

2026 when it is unhappy with say the

Venezuela policy with Trump's tariff

policy, I think people should expect

more of these precious metals, critical

minerals, intermediary inputs being

added to some kind of export control

list and weaponized by China.

>> I think that's really interesting.

Alice, I just want to mention one thing.

You you you uh raised the issue of

protectionism.

countries here in Europe or elsewhere in

the world may see these Chinese EVs

steamrolling into their markets and

displacing sales of, you know, valued uh

um domestic brands. And so I definitely

think that protectionist pressures will

rise, but I don't know whether here in

Europe anyway, the Europeans will

actually get it together to have the

unity to push forward, you know, uh,

greater tariffs or other other forms of

protectionism against the influx of

these Chinese cars. And just one other

really fascinating aspect that lies in

the future that is that BYD is planning

on bringing its so-called flash charging

batteries to Europe sometime this year.

Now these flash chargers can charge uh a

car within 5 minutes. That means that

they will significantly reduce the

amount of time it takes to charge your

EV. Uh the one I drove um in Germany, I

almost missed my plane on the way back

to the UK because the charger that we

found was so slow that uh you know, we

were standing there literally biting our

nails looking at the clock wondering if

we had the charge to get us to the

airport. That will be a thing of the

past when you can just draw up alongside

a flash charger that will charge your

car within 5 minutes. Now Tesla does not

have that technology. It is bringing out

technology, but it will be slower than

the five minute charge. What I've been

able to read online says that the next

Tesla supercharger will charge a battery

to within a range of 200 miles within 15

minutes. So China is ahead yet again in

this crucial aspect of the whole EV

market.

>> Very interesting. All right, let's take

one last quick break and stay with us.

>> [music]

>> Welcome back. China is now exporting

more than electronics and EVs. It is

exporting luxury food. From caviar to

fuagra, truffles to macadamia nuts,

China has quietly become a global

heavyweight in high-end agriculture,

supplying its growing domestic appetite

and increasingly reshaping markets

overseas. Now backed by provincial

governments and years of investment,

China now dominates global caviar

production. A shift that's turning what

were once niche European delicacies into

another front in China's expanding trade

power. I mean this is a topic close to

my heart given that I I do love food.

James

>> and you're a tremendous cook as well

which is credentials that I definitely

don't have. So um I think your take's

going to be more in instructive but I

would just start by saying how wrong I

have been in my thinking on this topic.

Um I never imagined that China would

leap to the global for forefront of

luxury food. Um I I just thought that um

markets such as caviar, fuagua,

macadamia nuts, black truffles, matcha

tea would remain the domain largely of

premium foreign brands in China. They

have a kind of a cache. Let's say the

brand is French or Australian or

Japanese or or Russian or Iranian when

it comes to caviar. But nope. uh in this

area too it seems that China has risen

to the forefront and is now dominating

uh not only the market inside China but

globally too. I just never imagined that

that would happen. The Financial Times

has got a really good piece on this

phenomenon. Um, and it turns out that

the caviar example uh goes right back to

the late 1990s when some aquaculture

scientists decided that you could uh use

um sturgeon to breed. Um, and it would

take about 7 to 10 years for a sturgeon

to mature, produce eggs, and then you

would uh take those eggs to a breeding

center and then the young sturgeon would

would uh would grow. And that's how this

uh market has developed. So since that

time when China produced almost no

sturgeon to 2024,

China produced 43%

of the global total. I just find that

extraordinary. But uh tell me Alice h

how are you seeing this whole topic?

Well, firstly I have to preface this

with the fact that you know when I I

love European food and I think there's

something special about uh you know

Parmesan coming from the region of Italy

um Hmon Burka coming from Spain there's

something that is unique about those

flavors and the artisal nature of how

that developed and when I mentioned this

topic to a couple of Europeans uh

European friends of mine I think they

were uh very upset by this because they

their immediate reaction was well it's

never going to taste as good as what we

produce here in Europe. But I think that

that defeats the purpose and I think

that that is not seeing this for what it

is which is that China is trying to

create more agricultural products. It is

trying to develop more high technology

and agricultural development aspects I

think which will both appear in the

5-year plan in March. And this is all

part of she's broader strategy to have

on the one hand agricultural

self-sufficiency but also develop

agricultural critical technologies that

can be developed domestically but also

potentially exported around the rest of

the world. I'm thinking particularly of

global south countries like Africa where

it would be particularly germanine and

and of use. So when I think about this,

I think about it more in the context of

of China, you know, using its export

engine and manufacturing engine to the

food realm. And I think that there will

be a degree of nationalism whereby

Chinese people will think, well, I don't

need to get caviar from Eastern Europe

or Russia. I don't need to get truffles

from Italy. These truffles domestically

have a a good enough terois, you know,

to borrow a wine term and and we want to

support domestic producers. So, I can

see that as a trend domestically with

within China. I'm not so sure if this is

going to be an attractor proposition for

foreigners, but you know, if you're cost

conscious, uh, you know, and you're

looking to get something that is half

the price, say, of a European premium

good, maybe you go for the Chinese one.

But I think it'll be harder sell

globally. I do think this will do very

well domestically for all the reasons I

mentioned. And and and just to drive

home a personal story, so I was

traveling in Eunan last year and Eunan

some people may know has the most

biodiverse uh range of mushrooms in the

world. Uh most of the world's actually

porchini mushrooms come from China, come

from Euran specifically. Uh and China

accounts for a third of the world's

truffles and exports went up 60% since

last year. I actually went to an

Italian's factory in Junan and he was

producing porchini mushrooms, portoella

mushrooms, uh truffles which he was

selling in powdered form or dried form

to the European market. Uh and

apparently Europe does not have enough

uh uh porchini mushrooms to make all

those risotto sachets. So in some ways,

China is part of this global industry

because it has the ability to produce on

mass and at scale. Uh and so I think

that there will be areas like this dried

mushroom powder that I'm talking about

where China is already being globally

accepted. And I don't think people

actually even realize that. And one last

fun fact I have about this is that

apparently people in China don't like

the taste of truffles. So it's a very

easy cell to to cultivate that

domestically in your and then sell it to

the rest of the world because it's not

seen as delicacy uh in China which I

thought was quite interesting

comparative advantage at play. But super

interesting story and I'm glad FT

covered it because I think it shows uh

so many aspects of what's happening in

China in terms of taste changing in

terms of domestic alternatives to

foreign products uh and in terms of

China trying to compete at at a global

scale with some of these premium goods.

>> Yeah. And you mentioned Yunan there,

which I'm really glad because I I think

that sometimes maybe people outside

China when they think of China, they've

seen all the pictures of the factories

and the big cities and the smog and the

pollution. But a a province like Yunan,

which is right on the southwest uh uh

sort of bottom corner of China on the

map, bordering Myanmar, is honestly one

of the most beautiful places anywhere in

the world. And you mentioned terowa. I

would have thought that Yunan tera is

superior to to many parts of the world.

The biobiodiversity is absolutely off

the charts. And uh in the financial

times story that I'm quoting from,

there's a quote here from uh one of the

growers there who says there's a joke

that whatever expensive fruit exists in

the world, Yunan will import it,

research it, cultivate it, and bring

down the price. So, I think that that

sort of um sums up uh this trend, but uh

we really shouldn't underestimate some

of the natural underpinnings that China

has to grow this stuff and to grow

really high quality uh uh food.

>> Well, I guess we're going to have to try

Chinese caviar next time we're in town.

I think you're going to China very soon,

James. So, you're going to have to try

some for me.

>> I have to admit, I don't like caviar.

[laughter]

>> Do you like truffles, James? Listen,

Alice, I I come from North Yorkshire,

which is a very set to bottom place. I

don't think I've ever had a truffle in

my life. What about you?

>> I am very partial to truffles. I mean, I

was in Southwest France uh a couple

months ago, and they and they have a

particular white truffle that's quite

unique there. Um so, I I am partial to

them. But James, we're going to have to

change that uh for 2026. We're going to

have to get you eating caviar and

truffles. [laughter]

>> Okay.

>> Living the high life. All right, James,

it is prediction time and we're going to

make our first predictions for 2026. Uh

I'm going to do something a bit left

field because I think uh this is going

to come up in a couple weeks. You know,

when we see on Jan 20 the economic

readout in China, I think the economic

uh trajectory of China is still going to

be a topline issue uh for investors and

the and the rest of the world in 2026.

But I want to take it to a prediction

that I feel fairly strongly about, which

is on the currency side. I think we're

going to see an appreciation of the CNY,

a slight appreciation by at least 10%. I

think I feel comfortable about the

currency ending at 6.8 to 6.9 uh by the

end of the year. Uh primarily because I

think the Trump administration is going

to elect uh a fairly doubbish uh Fed

chair. It could well be Kevin Hasset.

And in that case, uh, when we factor in

the interest rate differentials between

the Fed and the PBOC and the fact that

China isn't going to intervene, I think

strongly to to defend the currency, I

think we could see uh the currency go up

and strengthen uh against the dollar to

around 6.8 to 6.9 uh by the end of the

year. And that is materially important

because it obviously impacts US China

trade talks, negotiations. Trump isn't a

fan of a weak CNY. He wants to see a

weak dollar and I think this could be an

era in which there is some degree of of

compromise between China and the US. But

James, what's your prediction for 2026?

>> I'm going to go back to what we were

talking about at the top, Alice. I think

that China will swallow its pride,

swallow its humiliation, suffer its

losses with regard to Venezuela, and I

think it will play the long game. And I

think the Trump C meeting in April will

go ahead and both sides will try to gain

whatever advantage they can in other

areas uh effectively putting aside what

China is currently condemning as uh as

this unlawful move by the United States

in Venezuela.

>> Okay, so watch the space. We're going to

wait for a Trump meeting in April.

That'll be exciting. All right, that's

all for this episode. Thank you so much

for listening to China Decode. Make sure

to follow us wherever you get your

podcast so you don't miss an episode.

And talk to you again next week.

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