Chinese Economics Thread

[supercat]

Not only Africa, considering that Islamic Development Bank is the largest development organization in the Muslin world.

Islamic Development Bank to join forces with China-led AIIB
Partnership aims to address infrastructure funding gap in Africa

The largest development organisation in the Muslim world, the

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, is set to ramp up its fundraising activities and form a partnership with the China-led Asian Infrastructure Investment Bank to address a yawning infrastructure gap in African and other developing countries.

The plan to join forces with the AIIB to co-lend to projects in the Islamic world would

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of the China-led development bank that was launched in spite of US opposition in 2015.

“We will partner with the AIIB,” Bandar Hajjar, IDB president, said in an interview with the Financial Times. “We will co-finance many projects [with AIIB] in the future in Africa. Africa needs . . . about $150bn a year to finance infrastructure and there are about 650m people in Africa without access to electricity.”

Co-operation between the AIIB and the IDB, which are capitalised at $100bn and $150bn respectively, is set to create a new force in development finance for a swath of developing countries. Many of the IDB’s 57 member countries overlap with the AIIB’s approved membership of some 80 nations.

Such co-operation would assist the AIIB in finding projects to broaden its loan portfolio. The Chinese-led multilateral organisation approved $3.3bn in loans last year, up from $1.13bn in 2016, its first year of operation. Jin Liqun, AIIB president, has

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, including expanding the bank’s lending even further.

China scored a diplomatic coup when the AIIB was established after the UK chose to join the initiative over Washington’s clear objections. A host of other US allies quickly followed but Washington and Japan have yet to join the multilateral lending organisation.

Nevertheless, the AIIB has been

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, signing co-operation agreements with the World Bank, the Asian Development Bank and the European Bank for Reconstruction and Development.

In an indication of the IDB’s intent to ramp up its financing activities, the bank is planning to “soon” launch its largest single bond — a sukuk issue of $2.5bn — to support infrastructure, education, health and other projects within the bank’s 57 member nations, Mr Hajjar said. The move would follow a $1.25bn sukuk bond issued late last year.

The IDB has approved finance of $12.2bn in more than 250 projects, according to IDB data. Turkey, Indonesia, Pakistan, Egypt and Turkmenistan are the bank’s top financing recipients, while sub-Saharan Africa has $3.1bn in funding approved.

In a separate development, the IDB plans to launch a $500m philanthropic fund to support science and technology start-ups in member countries, according to Hayat Sindi, the IDB’s adviser for science, technology and innovation.

Funding is to be provided to those entrepreneurs selected by an international screening committee according to criteria such as innovative verve, sustainability and impact, Ms Sindi said. Thousands of potential applicants have already shown interest in applying for funding during an IDB roadshow undertaken in several countries, she added.

The aim of the fund was not to make a profit but to create jobs and inculcate a start-up culture in suitable parts of the Islamic world. In addition to the financing made available to entrepreneurs, the fund would also provide legal help, advice on business models and advice on protecting intellectual property, Ms Sindi said.

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[Jura The idiot]

now I read
China's tech industry catching up with Silicon Valley "faster than expected": economist
Xinhua| 2018-02-20 17:48:04

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China's technology industry has been catching up with the United States far faster than expected, with e-commerce and mobile payments already overtaking America, The Economist reported.

For example, China's venture capital funding was less than 10 percent of the United States' five years ago. But the latest data shows it to be more than 80 percent.

China's artificial intelligence papers cited by third parties grew to some 90 percent of that of the United States, a sign that it's catching up in hard science, the report noted.

China's e-commerce transaction level was already neck and neck with that of the United States five years ago. According to latest data, it's about 175 percent of the United States'.

China's mobile payments totaled 81 trillion yuan (about 12.77 trillion U.S. dollars) as of October 2017, the world's largest volume, according to the Chinese Ministry of Industry and Information Technology. It was much more than the volume for the whole of 2016, which stood at 58.8 trillion yuan.

However, despite the rapid growth, the article noted China's weaknesses in the technology industry, saying China's tech companies are worth only about one third of America's, and they generate relatively little revenue abroad.

China is still 10 to 15 years away from reaching tech parity with the United States, the report said.

 

[Anlsvrthng]

[

Yeah... forced like US corporations are forced to outsourced jobs? It's called a deal. If making money in China is more important than transferring technology, that's their fault. They don't have to do it. See the key here is the West thinks making money from others is their right so they're not just going to think I don't have to make money here. It's their exclusive right. Something they deny from others.

It was not about jobs,or outsocing,or money.

It was Nixon move to separate China from CCCp, by demolish all trade barrier, and increasing the trade between the two countries.

That made it possible.

 

[Anlsvrthng]

As I said before, it's because EU and US have much higher per capita GDP than China's. As a result, diminishing returns is more of a problem in these already highly-developed countries.

Your argument is cargo colt at its core.

If you pile up the same infastructure like Seeden, then until you reach the GDP of them you have positive ROI.

I don't understand your logic. Since investment is always finite, there are only a finite number of projects that can be done, whether or not they are profitable.

It is true for the UK, where you have restricted supply of workers, but in china they had unlimited peasant from villageswho took all possible jobs.

Means that every project had positive ROI, up to do point of the exhausted job sources from villages.

This was the history of the CCCP as well.

My argument is that there is no convincing evidence that China's return of investment (ROI) is much worse than those in the developed nations. It is probably comparable to other developing nations with similar per capita GDP. On the other hand, if you compare China and Spain's GDP growth rate, you will realize that they probably work quite differently.

I think no one can collect strong evidence, considering that if the ROI negative then the reporting authority has to be the same who approved it in the first place.

Spain is a nice example ,from 2000 up to 2008 thee was a big investment boom, and the GDP growth was fuelled by it.

Now it negativly contributing to the GDP, and the hangover ( the high debt level of houseolds, and the lack of bankrupcy) impact negativly the economical growth.

 

[Anlsvrthng]

Excessive focus on ROI also misses a huge, if not the primary reason for building infrastructure in the first place - positive externalities that stimulate economic growth and development.

Agree, but don't forget, if you run out of the free resources, then the number of projects can not be increased, and f the previous projects had negative productivity impact then the number of future projects decrease, and that creating negative feedback loop, as the growing number of investments created a positive one.

A big part of why western economies have higher ROI is because the state doesn’t build much infrastructure anymore in the west. That is pretty much all outsourced to the private sector, who cherry pick the most profitable projects to fund while not giving a solitary toss about broader economic ramifications.
.

The state build it , who built the roads/ bridges and so on?

 

[AssassinsMace]

[

It was not about jobs,or outsocing,or money.

It was Nixon move to separate China from CCCp, by demolish all trade barrier, and increasing the trade between the two countries.

That made it possible.

You would've been nuked by the Soviets by now. That's why it happened. The US wouldn't have won the Cold War without China.

 

[Dizasta1]

There is some truth to what is said about the trade deals set between China and America back in the day. The rift between Soviet Union and China was the much needed impetus for American-Chinese diplomatic and trade talks.

Most often overlooked, yet significant historically, it was Pakistan's efforts formed the bridge that ushered the American, Chinese relations to take a foothold.

But in present times, China should take caution and recognize that Russia is NOT the Soviet Union. That the Russian Federation is an invaluable partner nation with whom China must maintain strong, unbreakable ties.

If China is to learn from history, then take note that America on its own would not have become a superpower. Without allies in Europe, all of Europe, there wasn't a chance in hell that America could have survived as a superpower during the Cold War. As true as that was then, so to it is now. And for China, it's important to have core allies with whom there are strong trade, political and military ties. The SCO is a step in the right direction and if only India could come to it's senses. Then SCO would become a powerful counter-balance to NATO. Except that SCO's sole purpose wouldn't be military in nature. Rather political and economic at its core. With it, China and Russia would be see an expansion of trade with many more nations who wish to rid themselves off IMF-WB shackles.

A power that stands for fairness and true free trade, would benefit all. Unlike the greed of a few, that sees the rich become permanently rich and the poor imprisoned in permanent poverty.

Learn from history and do not repeat the sins of other powers.

 

[broadsword]

[

It was not about jobs,or outsocing,or money.

It was Nixon move to separate China from CCCp, by demolish all trade barrier, and increasing the trade between the two countries.

That made it possible.

That is the narrative perpetuated by the Western media: it was all Nixon. Deng played the bigger role.

 

[AssassinsMace]

I'll give a little history lesson. If it wasn't for China, the West would've never embraced human rights. What was the West before the Cold War? They were colonialists raping the world for its riches to which is why they're on top today. Bickering amongst themselves about who wanted more than the other started wars between them. Those wars especially WWII drained them making them vulnerable and fearful of communism. When China turned communist, it was their worst nightmare coming true. It was a colony revolting against them all and since it was successful the Western colonialists feared it could spark a world wide revolution against them. Why do you think the West hated China more than the Soviets? The Soviets couldn't have that connection with the colonized world that China could because the Chinese were oppressed by Western colonialism. The West was weakened by WWII. They couldn't hold back a world revolution against their colonialism. So they had to "embrace" human rights and decolonize for PR to stave off a global revolution but leave puppet dictators they could buy-off to keep them loyal to their colonial master. That's what the Cold War was all about. So don't buy the lie that the US helped out China from the goodness of their hearts. The US needed China against the Soviet Union during the Cold War. That's why they opened relations. No altruism involved. Hence after the Cold War the US turned against China and other countries like Pakistan who helped them win the Cold War. The US opened its economy to other countries during the Cold War because it was a pay-off to keep them as allies.

 

[Dizasta1]

Speaking of China, economics and history, I can't help but recall how China was economically doing very well during the Qing Dynasty.

At the time Britain wished to do trade with China. However China didn't share such ties with Britain. After much persistent British overtures, China did grudgingly permit the British to do trade. One could tell how China wasn't all too happy to do trade Britain, as they were only permitted to enter China in the foreigners quadrant, at a port city and were confined to that quadrant. Not permitted to venture elsewhere in China to do trade. Such were rules applied to all foreign traders.

Chinese method of trading was simple and yet profitable. Where all Chinese goods bought by foreigners, was paid for in Silver by the buyer. This sort of trade, as Britain found to it's misfortune, was not favorable to them. Since Britain's trade with the European and North Americans was mostly done through "paper currency," better known as Fiat Currency in the western world. Britain was bleeding Silver doing trade with China.

So what did the ole Britannia do when faced with unfavorable odds? It resorted to it's Imperial/Colonial mentality, by introducing Opium into China. Soon the this Opium spread like wild fire, with many Chinese falling prey to it's addiction. Weakened state saw the Qing Dynasty react angrily in the wake of Opium menace. And that's what gave wind to the ember that ignited into a war. Britain used this to subdue China by defeating it with superior firepower. Forcing the Qing Dynasty to the negotiating table. Consequently making China to agree on trade, less payments in Silver.

A treachery, deceit, reflective of a colonial, imperial power. Ought not ever be forgotten by China or the rest of what is conveniently coined as "Third World." It is a similar sort of deceit Britain had used against the Mughal Empire (present day Bharat/India), where the British came under the guise of the "East India Trading Company."

In the Muslim World, there is a description of such nations. They are referred to as Ya'jooj 'wa Ma'jooj, two people/nations/states which obsessed with consumption and who force their will open other nations, to make others into carbon copies of themselves. One only need but look around and see how old nations Japan, China, India, Arabia, Egypt and etc have lost their traditions in the wake of modern western civilization.

An advice to both China, Russia and the rest of the Third World, who have both opposed western hegemony. Do NOT forget your roots, do NOT mimick them, do NOT forget what happened in your history. The Bolshevik Revolution, Opium Wars, Perry Expedition, East India Trading Co and etc, all serve as reminders of how deception works. And most of all, do NOT be complacent!!