September 14, 2010
Summer Davos 2010 Underway in Tianjin
The World Economic Forum's so-called "Summer Davos" confab (officially the Annual Meeting of the New Champions) is underway in Tianjin as the world's political, business, and media elite chew the fat of hot topics and hot dishes. Click here to see the full line-up of participants and panels...
Labels: foreign exchange, global economy, globalization, world economic forum
September 10, 2010
EU Helps Small Business Into Chinese Market
The European Union's China Advisory Council recommends that the many business centers established by EU member nations in China be consolidated into "European Houses" to coordinate efforts to get small and medium sized EU enterprises (SMEs) into China. The EU Small Business Act is pushing an effort to help European SMEs into global markets particulary the biggest outside the EU, the USA and China. Overall the EU is expending a lot of effort and financing behind the effort. Why isn't the USA doing something similar? The US Commercial Service with its small network of offices in China and bloated Washington-centered bureaucracy seems lackluster by comparison...
Labels: chinese trade, foreign exchange, foreign trade, free trade
April 08, 2010
Vladivostok Increases Ties with Heilongjiang
The mayors of Vladivostok and Suifenhe, Heilongjiang Province, signed a protocol for increasing ties and cooperation. The plan is set up a Russian-Chinese Industrial Park at the Vladivostok State University. Despite its name the park will focus on scientific research and partnership.
Sinomania! readers will recall that at the provincial level Heilongjiang and Primorsky Krai (Russia's Far East) are spearheading cooperative efforts. Xi Jinping's recent Russia-EU tour began in Vladivostok with a welcome from Russia's top leaders.
Manchuria and Siberia remain underdeveloped and rich in resources. Along with the Tumen River area the region could be a major center of migration, industrialization, and urbanization in the medium to long term....
Sinomania! readers will recall that at the provincial level Heilongjiang and Primorsky Krai (Russia's Far East) are spearheading cooperative efforts. Xi Jinping's recent Russia-EU tour began in Vladivostok with a welcome from Russia's top leaders.
Manchuria and Siberia remain underdeveloped and rich in resources. Along with the Tumen River area the region could be a major center of migration, industrialization, and urbanization in the medium to long term....
Labels: cooperation, foreign exchange, foreign relations, russia
February 08, 2010
Vietnam-Guangxi To Expand Trade Zone
The ASEAN-China free trade agreement became effective January 1. Already China has displaced the USA as ASEAN's number 3 partner (after Japan and EU). Vietnam is not expected to acceed to the new ASEAN-China free trade agreement until 2015, buying time for the country to prepare for more open competition. Paving the way may be an expanded trade zone straddling the border towns of Mong Cai in Vietnam and Dongxing in Guangxi Zhuang Autonomous Region that has a sizeable Vietnamese population.
Vietnam has approved the arrangement and the government of Guangxi is seeking Beijing's go ahead. The new trade area will include infrastructure building including a new bridge over the Beilun River that separates the cities. There were around 5 million border crossings and over $4 billion (US dollars) in cross border trade in 2008.....
Labels: foreign exchange, foreign relations, free trade
January 27, 2010
China Year End 2009 Data Shows Strong Stable Growth
Remember how 2009 began (much like this new year) with predictions of a crash in China because Beijing had poor experience handling a recession and China couldn't possibly decouple from the global recession? Turns out the Chinese economy grew steadily and healthfully all 2009. Here are data points for last year: GDP expanded 8.7%; retail sales grew (in real terms) 16.9%, better than 2008; fixed asset investment grew 30.1% with urban fixed asset investment at 30.5%; capital expenditure investment in secondary & manufacturing industry expanded 26.8%; RMB 9.59 trillion (Yuan) in loans were issued, a 95% increase; exports were down -16% to $1.2 trillion (US dollars) and imports dropped -11.2% to $1 trillion; with exports down Chinese industrial output grew only 11%, the slowest since the 2001 recession; Beijing's foreign exchange reserves grew to $2.4 trillion; although food prices remain inflationary, overall CPI deflated to 0.7%....
Labels: economy, exports, foreign exchange, inflation, investment
August 06, 2009
Reunification Watch: Taiwan Takes UnionPay
In another example of economic and financial cooperation between Beijing and Taipei, China UnionPay atm and credit cards will be accepted on Taiwan with a swiping ceremony possibly tomorrow (Friday). UnionPay is China's monopoly card issuer and has a growing network of ATMs around the world.....
Labels: foreign exchange, reunification, taiwan
April 29, 2009
China-Japan Bilateral Talks Urge Currency Swaps
PMs Wen Jiabao (China) and Taro Aso (Japan) are meeting in Beijing and both nations are pressing for closer economic cooperation. China is Japan's number 1 trading partner now and hard hit by the decline in Chinese imports. Wen urged greater expansion of the Chiang Mai Initiative of bi-lateral currency swaps originally devised during the so-called Asian Flu of 1997-98 and its aftermath. This is further evidence of Beijing's desire to solidify capital flows based on the declining US dollar....
Labels: currencies, foreign exchange, foreign trade, japan
April 16, 2009
Is China Hoarding Copper?
Lots of speculation in the news about moves by the State Reserve Bureau in Beijing to buy huge amounts of primary metals, particularly copper but also aluminum and cobalt. Is China planning a copper standard to back the Yuan? Is Beijing stockpiling industrial resources while the global economy is down in order to be ready for the next boom cycle? Or is China really still chugging along at full speed (compared to sluggish Western economies) despite the impact of the Panic of '08?....
Labels: currencies, foreign exchange, forex, renminbi, yuan
January 21, 2009
Geithner Confirmation: China Currency "Significant Issue"
At the confirmation hearings today for incoming Treasury Secretary Timothy Geithner, sponsors of anti-free trade China currency manipulation legislation expected lip service to their belief that Beijing is "manipulating" Yuan exchange rates. Geithner obliged but his reponses were guarded. He said,
"I believe that it is in the interests of the global economy, not just our interests, that our major trading partners move over time to a more flexible exchange rate system."
Geithner pointed out that other major trading partners of USA (read: Japan) also need watching.
Is this a sign that the Democratic controlled Congress and President Obama will slap countervailing duties on China? And will the resultant price inflation of nearly every good bought and sold in the USA lead to wage inflation or just further erosion in standards of living?
Labels: currencies, foreign exchange, free trade, yuan
October 08, 2008
Is Bretton Woods II Dead?
The coordinated rate cuts by central banks around the globe today included China. The faded G7 powers and their corporate and state-owned (BBC, for example) press still view the so-called "subprime," "credit," "liquidity," financial crisis as an Atlantic Alliance issue. Nothing could be further from the truth. China is at the core of the financial system as much as the USA since they both depend on the "Bretton Woods II" regime of financing trade deficit with borrowed dollars. For years the USA has agreed with China that 'you buy our goods, we buy your debt.' That system is now unravelling.
A week ago the President of France Nicholas Sarkozy said "Laissez-faire is finished." He joined the call first made last year by outgoing German Chancellor Gerhard Schroeder for a G7 summit to fix the world's financial mess.
But what we really need is a Bretton Woods III conference where the USA, the EU, and China sit down and hammer out what the world's financial future will be. Certainly rich holders of dollars such as Japan, Russia, and financial centers of the Middle East should be there too as important participants.
If the future will be multipolar balanced by the dollar, the Euro, the Yen, Renminbi (Yuan), and Gold, as famous gloomsayer Mark Faber forecasts, then we need to get together now to craft a new system.
Labels: bretton woods ii, dollar, financial crisis, foreign exchange, gold, yuan
February 15, 2008
Japan Forex Reserves Growing "Suspiciously Fast"
Morgan Stanley believes the net result is not stealthy intervention but skillful day trading of Yen/Euro positions and that the data reveals Japan is diversifying away from the US Dollar to over 20% Euro composition in its foreign exchange reserves."Japan’s reserves are growing suspiciously fast. Japan’s foreign reserves expanded from US$946 billion in September 2007 to US$996 billion in November, an increase of US$50 billion in four months. Assuming a 2.5-3.0% return on the underlying assets, Japan should only be enjoying US$25-30 billion in annual investment earnings, or US$6-8 billion a quarter. Further, it is widely assumed that Japan has the bulk (90%) of its reserves in USD, and the MoF never diversified away from USD. With such low holdings of EUR, valuation changes – from the rise in EUR/USD – should not have been a major factor generating gains in reserves. Indeed, what is embedded in our reserve tracker file assumes 90% USD holdings. Our presumptive calculations identified a US$13.7 billion gain during September-January due to the returns on the underlying assets, and another US$18 billion from valuation changes, leaving US$18 billion of the reserve increases unexplained by our metric. Could the MoF have conducted secretive interventions worth US$18 billion? "
If true, this raises another interesting question: Is America's loyal Asian satellite dumping the Dollar?
Labels: currencies, euro, foreign exchange, forex, globalization, japan
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