Chinese Economics Thread

[horse]

if is good enough for the US to ignore the rules when it suits her, why can't anyone else?

It is a practical point too.

They already barred a high ranking Chinese official in Carrie Lam, who cannot use her VISA and Master Card anymore in Hong Kong.

Who is to say the Untied States won't go after the Saudi Royal family and bar them from US Dollar transactions?

Weaponize the USD, and lo and behold, people might start thinking of using alternatives.

 

[horse]

Comrade Xi: Hello, is this the prince of Saudi Arabia? We intend to buy most of the oil we need from Iran and they will take our RMB.

How much oil can you sell us? Give us a quote in RMB!

 

[emblem21]

It is a practical point too.

They already barred a high ranking Chinese official in Carrie Lam, who cannot use her VISA and Master Card anymore in Hong Kong.

Who is to say the Untied States won't go after the Saudi Royal family and bar them from US Dollar transactions?

Weaponize the USD, and lo and behold, people might start thinking of using alternatives.

Lol, they are killing the dollar at an accelerated rate. Interesting how they are quickly screwing themselves over by doing all these things without consideration as to the consequences of there actions. The US is going to pay dearly when the time comes and at a time when they wont see it coming

 

[AndrewS]

Since they lose some of the money through currency exchange. With the SAR pegged to the dollar SA does not lose a penny through any transaction.
As for OPEC transaction, it's not dominated it's the rule since the price is pegged to the two major oil exchange markets.

That's not correct.

Saudi Arabia imports more from China than the USA. Chinese manufacturers have to obtain RMB to pay their production costs.

So if Saudi sells oil to China in USD, eventually somebody has to convert the USD to RMB and suffer a currency exchange cost.

So why not skip the USD, and have the Saudis hold some RMB temporarily to cover imports from China?

Contracts with Aramco could just be amended to convert actual settlement from USD to RMB.

Alternatively, the Chinese oil futures market is now running at 1/3 to 1/2 the size of Brent Crude.

That is already enough to sustain some oil contracts being delivered in RMB, and bear in mind the Chinese benchmark was only launched 2 years ago. So it's still in the early stages of growing.

 

[Nobino]

That will never happen since SAR is pegged to the dollar and OPEC's transaction currency is US Dollar.

Lol, who cares? The only thing we need from them is to use RMB with interested countries. They can keep the usd if they want

 

[SimaQian]

That's not correct.


So why not skip the USD, and have the Saudis hold some RMB temporarily to cover imports from China?

Because the Saudis have themselves squeezed by the balls by the Americans when they signed to get weapons from US.
If they dont stockpile USD, their high tech weapons will not fire. Now Saudi is bleeding with USD
with their endless bombing with Yemen, coupled with collapsed of price oil and Haj tourism revenues.
Now that Saudi has already bombed their neighbor, it would be impossible for them to reduce
their dollar holdings.

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This is aside from those Saudi princes that literally showers women with USD.

We see how much they need more USD than RMB.

 

[Tam]

Because the Saudis have themselves squeezed by the balls by the Americans when they signed to get weapons from US.
If they dont stockpile USD, their high tech weapons will not fire. Now Saudi is bleeding with USD
with their endless bombing with Yemen, coupled with collapsed of price oil and Haj tourism revenues.
Now that Saudi has already bombed their neighbor, it would be impossible for them to reduce
their dollar holdings.

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This is aside from those Saudi princes that literally showers women with USD.

We see how much they need more USD than RMB.

China isn't exactly innocent here as they sold the Saudis the Rainbow or Wing Loong drones that are used to attack the Houthis or spot targets used for bombing.

 

[SamuraiBlue]

Look in the later half of the 21st century, oil will not be a commodity any more since the hydrogen society will over take the present carbon society in which case the petro-dollar scheme will collapse.
OPEC nations as well as all nations dependent on exporting oil all feels this coming just not knowing when it will come.
So talking about RMB taking over the US dollar as a transaction currency is meaningless since there are no commodities that Mainland China has a monopoly of.

 

[The Observer]

China isn't exactly innocent here as they sold the Saudis the Rainbow or Wing Loong drones that are used to attack the Houthis or spot targets used for bombing.

I think what Sima was trying to say was Saudis currently rely more on US/Western-made arms than Chinese arms, so they need more USD in order to pay for their weapons from the west rather than China doesn't sell arms to the Saudis and therefore have a moral high ground.

 

[SimaQian]

New US sanctions again. Any idea of the impact?

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Xinjiang’s sprawling conglomerate may be biggest ever to face US sanctions

• Three officials from the Xinjiang Production and Construction Corps have been put on a US sanctions list for links to alleged human rights abuses
• XPCC has stakes in more than 800,000 companies and groups in 140 countries

One of China’s most secretive and expansive organisations, the Xinjiang Production and Construction Corps, has moved into an international spotlight it would probably rather avoid after the entity and three of its officials were put on a

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sanctions list for links to alleged human rights abuses.
Known as XPCC, the organisation operates in the area of China that shares its name,

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, an autonomous region three times larger than France in China’s far west that borders Afghanistan, Pakistan and India.
The US move against XPCC and its majority owned subsidiaries could be the biggest case in the history of the Office of Foreign Assets Control, the agency under the US treasury department that enforces financial sanctions, for the potential number of holdings affected. The sanctions have multiple implications for XPCC, from choking off bank loans to curbing its farm exports, such as cotton and tomatoes. They could also threaten its investments.
XPCC, which is involved in a myriad of industries, from construction and infrastructure to property and farming, has stakes in more than 800,000 companies and groups in 147 countries, according to US consultancy and commercial intelligence firm Sayari, which prepared a report on the conglomerate's structure.