Turkey Will Be Ground Zero in the Next Global Debt Crisis

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Turkey is a beautiful country with a rich history including Greek, Roman and Muslim influences that make it one of the most fascinating places on Earth. It is literally a bridge between East and West: The mile-long Bosporus Bridge just north of Istanbul connects Europe and Asia across the Bosporus Strait.

Turkey has been a magnet for direct foreign investment from abroad and dollar-denominated loans by international banks to local enterprises. This investment enthusiasm is understandable given Turkey’s well-educated population of 83 million and its rank as the 17th-largest economy in the world, with a GDP of just under $1 trillion. Continue reading

China eyes global economic leadership as U.S. turns inward

In this photo taken Wednesday, Nov. 23, 2016, Kenyan laborers and a Chinese foreman work to finish the construction of an existing bridge that goes across a corner of Nairobi National Park in Nairobi, Kenya. A controversial Chinese-built railway project involving an even larger 6km bridge that would go all the way over the beloved protected area in Kenya’s capital has divided conservationists in this East African country. (Photo: Ben Curtis, AP)

 

This year, a 300-mile railway will begin slicing through Kenya, cutting travel time between the capital, Nairobi, and one of East Africa’s largest ports, Mombasa, from 12 to four hours and breeding hopes of an economic and tourism revival in the region.

The country’s most significant transportation project since its independence in 1963 is being built courtesy of China.  China Road and Bridge, a state-owned enterprise, leads construction of the $13.8 billion project, which is financed nearly 100% by the Export-Import Bank of China.

The railroad is one of a host of infrastructure projects China spearheads around the world in an ambitious quest to reinforce its emergence as the world’s next economic superpower while President Trump turns his back on globalization. Continue reading

Europe mulls a pivot to ASEAN

Most of EU businesses are ready to increase trade and investment in the ASEAN space over the next five years, with Malaysia and Indonesia to emerge as the most attractive markets. European manufacturers are also pushing for the conclusion of a free trade agreement between the EU and ASEAN to eliminate structural disadvantagesThe EU views ASEAN as a viable alternative to China.

The decline in investments flowing from the European Union (EU) member states to the Association of Southeast Asian Nations (ASEAN) should not deceive. As witnessed by a recent survey, European companies look in prospect more favorably to the Southeast Asian market than to China’s. Continue reading

Washington, China, and the Rise of the Renminbi: Are the Dollar’s Days as the Global Reserve Currency Numbered?

Abstract

The U.S. dollar has dominated the international monetary system since the end of World War II. While the U.S. economy has generated weak growth since 2009, and accumulated a large sovereign debt, the dollar’s status as an international medium of exchange and reserve currency has not diminished. The Chinese renminbi (RMB), however, barely visible in international trade or financial flows just three years ago, appears to be blossoming. China is now the world’s largest trading nation, and more corporations, particularly in Asia, are beginning to invoice their business in RMB. The Chinese regime is calling for a reform of the international monetary system to expand the internationalization of the RMB. Speculation has begun about whether the U.S. dollar could be supplanted by the RMB. Such a development would jeopardize the enormous economic advantages that the U.S. has enjoyed by possessing the world’s dominant currency. Moreover, it would signal a relative decline in American prestige and global leadership. The answer to the dollar’s potential decline is not to seek obstacles to China’s or any other nation’s economic success, but to change fiscal and monetary policies at home in order to maintain the dollar’s competitiveness.The U.S. dollar has dominated the international monetary system for approximately 70 years. While the U.S. economy has generated weak growth over the past six years and accumulated a large sovereign debt, the dollar’s status as an international medium of exchange and reserve currency (currency held by foreign central banks) has defied the odds and has not diminished. Continue reading

Fivefold surge in Americans on Chinese-firm payroll in the US: report

Although the numbers are still quite low, the key issue is not the amount. It likely wouldn’t take more than running 5% of American businesses nation-wide in the most critical industries and businesses to wreak economic havoc if the CCP so wished to pull the trigger — and as the last few years have increasingly shown us, the Chinese leadership’s behavioral patterns and actions indicate wreaking havoc on America is their intention.

 

The number of Americans on Chinese company payrolls has surged more than fivefold over the past five years along with growing foreign direct investment by China in the United States, a study by two US-based organisations has found.

The report – released this month by non-profit group, the National Committee on US-China Relations, and economic think tank Rhodium Group – highlighted the expansion of Chinese firms in various American congressional districts.

The report, titled “New Neighbours: Chinese Investment in the United States by Congressional District”, showed Chinese firms had invested US$46 billion in new establishments and acquisitions in the US since 2000.

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