The Great Yuan Gambit: How China's 1994 Devaluation Suckered the West and Built an Economic Empire
The Great Yuan Gambit: How China's 1994 Devaluation Suckered the West and Built an Economic Empire In the annals of global economics, few moves have been as audacious and transformative as China's 1994 currency devaluation. What appeared as a routine unification of exchange rates—a 33% overnight drop from 5.8 to 8.7 yuan per U.S. dollar—unleashed a cascade of events that turned a struggling socialist economy into the world's manufacturing juggernaut. This wasn't mere reform; it was a calculated sucker punch that exploited Western greed, and short-sightedness. While the West cheered China's "market embrace," Beijing engineered a system of perpetual undervaluation, sterilization, and strategic hoarding that hollowed out industries abroad and amassed unprecedented leverage. Decades later, as China pivots to de-dollarization and global dominance through initiatives like the Belt and Road, the contradictions are stark: apparent market liberalization masking s...