Can China be trusted to be a responsible financial power?

CAUSEWAY BAY is back in business. Even as the world shuts down, the retail heart of Hong Kong, which enforced an early lockdown, is beating again. Yet normality is not complete. The local branch of ICBC, a symbol of Beijing’s sway, remains barricaded. Its managers fear that pro-democracy protesters, free after weeks of quarantine, might target it again. This points to a tension within China’s global ambitions. Its political system can suppress problems fast by mobilising everything in the pursuit of one goal. But it also creates crises—and lets them fester.

Trust is what binds the financial system together. Economic agents need to be convinced, not coerced. But like many China watchers in other spheres, they remain both awed by its formidable rise and doubtful it cares about the common good. “People think it is like the Death Star from “Star Wars”. It is this massive, inscrutable thing sitting up in the sky that has the potential to destroy us all,” says Jan Dehn of Ashmore Group, a fund manager. Can they trust the regime whose attempted cover-up let the virus escape in the first place?

A partial schism in the world’s financial system will be hard to arrest. Economic weapons are cheap and require few permissions, so American presidents will continue to like them. The longer they last, the more workarounds get entrenched...