Wider use of yuan would benefit Central Asia
Opening up the Central Asian market for the yuan would not only benefit China, but also Central Asian countries, in terms of their governments and people. In the international macroeconomic environment in the past decade, one of the biggest changes has been the increasing shortage of US dollar liquidity. If no suitable emerging international currency can be found as an alternative, liquidity in the global market will shrink, which will jeopardize economic development in many countries.
Yuan playing bigger role in global reserve system
Recently, one of the most powerful central banks in the world, the European Central Bank (ECB) invested 500 million euros ($558 million) of its foreign reserves in yuan-denominated assets, by selling a small portion of its US dollar holdings. It is part of the ECB’s diversification strategy to add the Chinese currency into its foreign exchange reserves.
Egypt trying hard to open up to foreign investment
Currently, Egypt faces challenges including terrorism and a decline in tourism revenues, as well as a significant decline in reserves of foreign currency and a large increase in the trade deficit. So the Egyptian government has had to take steps to overcome these chronic problems.
China could benefit from Trump-Modi summit
It will be interesting to see how Indian Prime Minister Narendra Modi’s visit to the US will influence the two countries’ bilateral economic ties. India-US economic relations have not always been seen as having the same order of magnitude as China’s economic ties with the US, and the main reason for this is that India lags behind China in terms of opening up its market to foreign investors. US President Donald Trump has put the world on notice that “America First” is not just campaign rhetoric but an actual policy position. If Trump fights for US firms’ interests and persuades India to promise wider opening-up during his summit with Modi, China, as a key economic partner of India, will also gain benefits. Therefore, China is paying close attention to Modi’s upcoming US visit.
Sino-Russian cooperation can counter impact of NK nuke program on Northeast China’s economy
North Korea’s nuclear program is likely to have a long-lasting effect on the economic landscape of Northeast Asia, which deserves attention even if tensions on the peninsula have abated.
China moving toward fully developed credit systems
Currently, in our society, the lack of credibility is still a very serious issue, which is an objective fact that we must face up to. At the same time, we should also recognize the progress and achievements in construction of credit systems. In fact, our country has already made some important and positive progress in credit building over the years.
West can no longer hold back Chinese strength
German Chancellor Angela Merkel’s recent remarks about the EU obligations under Article 15 indicated her willingness to back China’s bid for market economy status. Prior to this, the UK had also expressed such support, but there is still a long way to go before China is recognized by the EU as a market economy.
Taiwan errors in Burkina Faso open door for mainland
Panama has recently cut ties with Taiwan in favor of the Chinese mainland. Will Burkina Faso be the next one to follow suit? Although Taiwan’s aid to the African country is extremely generous, the economic assistance, which is politically motivated, has proved to be insufficient.
India and Pakistan membership a challenge for SCO
China has taken over the rotating presidency of the Shanghai Cooperation Organization (SCO), and is scheduled to host the next summit in June 2018 in China. Earlier this month, the addition of India and Pakistan as full members increased this organization’s reach to South Asia from Eurasia and Central Asia for the first time.
US labor laws to blame, not Fuyao management
Chinese company Fuyao Glass Industry Group is facing industrial action by the United Automobile Workers union at its plant in Ohio, US, according to a recent report by The New York Times. I’m not surprised to hear the news. No matter whether it concerns foreign direct investment or simple exports of goods or engineering contracting, labor disputes have long been one of the biggest challenges facing Chinese companies in overseas markets, regardless of whether they are in developed countries like the US or in developing countries like Peru, Zambia or Cambodia.
Can big data help to resurrect the planned economy?
While it is generally believed that the planned economy doesn’t work, Alibaba founder Jack Ma Yun has expressed his confidence in the recovery of the planned economy with the help of new technologies. This opinion provoked debate, and prominent Chinese economists Wu Jinglian, Qian Yingyi and Zhang Weiying have all refuted the view on different occasions since late last year. Here are some extracts of their viewpoints.
Agriculture cooperation can ease Sino-US tension
China is likely to have a temporary honeymoon period with the US at a time when US President Donald Trump is facing political turmoil at home.
Trump has it all wrong on climate change and China
More than six years have passed. The Chinese government has made persistent efforts to tackle climate change. Yet the US government is once again using China, India and other developing countries as an excuse for its own inaction. So it is time to set the record straight and debunk Trump’s excuses and false accusations.
Chinese firms making contribution to Africa
Zambia’s detention of 31 Chinese nationals for illegal mining in the country’s copper belt quickly made headlines recently. While the incident has been handled appropriately, with the Zambian government agreeing to release the 31 Chinese nationals after China’s diplomatic efforts, some foreign media outlets used the case as a way to criticize China’s investment in Africa.
China converting US from coal to wind tech
US President Donald Trump’s removal of the US from the Paris climate change agreement has been correctly reported as an abdication of American leadership on the topic. The news that the EU and China immediately partnered up to enlarge their commitments showed that the world will get on without the US. However, the real surprise came with the report that Chinese wind company Goldwind was training former coal workers in the US to be wind professionals.
Strong fundamentals push yuan’s appreciation
Entering June, a piece of good news is greeting thousands of Chinese families who have children studying in the US, and expats working in China: The Chinese currency, the yuan, is making healthy gains against the US dollar.
China-built railway will boost Kenyan economy
Will Kenya see an increase in its government’s debt burden due to the construction of a Chinese-built high-speed railway named the Madaraka Express? Built by the China Road and Bridge Corporation, the rail line, connecting the port city of Mombasa with the capital of Nairobi, cost $3.8 billion, and concerns have been expressed about Kenya’s possible exposure to debt risk if the country fails to repay the Chinese loans.
China learns from the past to avoid financial crisis
Moody’s Investors Service recently announced that it had lowered China’s rating from Aa3 to A1 on the grounds that as the country’s economic growth slows, the fiscal position will weaken in the next few years and debt levels will continue to rise. This prompted bearish sentiment toward the Chinese market, dragged down offshore yuan rates and increased pessimism about China among global investors. In fact, over the past decade, this kind of bearish forecast has been common among institutions such as the IMF and some overseas hedge funds, as well as institutional investors. Overseas investors have discussed for many years whether China will experience a “Minsky moment” – a precipitous drop in asset values.