Wandering China

An East/West pulse of China's fourth rise from down under.

Shifting power balance sees China, Japan dig deep to save the West [the Australian]

Greetings, am still wandering through Europe getting a feel of the impact (sometimes, the lack of) of China in this region. Internet access has been intermittent as I travel through the countryside. More regular updates to come when I return. In the meantime…

A view from Australia: Shift in the global balance of power tilting east or will this be an Asian century of footing the bill for debts it did not ‘directly’ incur? The way this article is phrased suggests it also means footing the bills with little equivalent exchange in return. Will paying for someone else’s bad habits become the new norm in this new landscape of sharing a boat of interdependence and integration? Perhaps this shift is purely perceptual.

…in a sign that Europe is nearing the end of its tolerance for “helpful” suggestions from outsiders, European Commission president Jose Manuel Barroso told the G20 that the EU was not the cause of the current crisis and won’t be “lectured” by anyone.

“Frankly, we are not coming here to receive lessons in terms of democracy or in terms of how to handle the economy,” Barroso said.

– – –

Shifting power balance sees China, Japan dig deep to save the West
BY: RICHARD GLUYAS
Source: The Australian, published June 20, 2012

THE arrival of the Asian century has been underscored with news that China will kick in $US43 billion ($42.4bn) to the International Monetary Fund’s global firewall.

China’s commitment, which is the third largest after Japan ($US60bn) and Germany ($US54.7bn), compares with a weighty contribution from the mighty US — zero.

The US is clearly wrestling with its own problems, and a donation to Europe’s begging bowl would be political poison in an election year. Even so, the latest commitments to the new $US430bn fund, which were announced during the G20 summit in Mexico, highlight the anomaly of the US and Europe controlling key global institutions such as the IMF and the World Bank, when the centre of economic power is tilting east. Read the rest of this entry »

Filed under: Australia, Beijing Consensus, Chen Wenling, Chinese Model, Economics, Europe, European Union, Finance, Foreign aid, IMF, Influence, Peaceful Development, Politics, Public Diplomacy, Soft Power, The Australian, The Chinese Identity

Shanghai shipping slump as IMF warns China on euro slump [Telegraph]

An attempt to force China’s hand or affirmation of just how intertwined we all are?

The IMF warns China that it is vulnerable to the “clear and present danger emanating from Europe” which would see Chinese growth halve to roughly 4% if the crisis escalates.

For the actual report by the IMF (prepared by the IMF Resident Representative Office in the PRC, go here.

It states:

‘A storm emanating from Europe would hit China hard
* China’s growth rate would drop abruptly if the Euro area experiences a sharp recession
* But China has room for a countervailing fiscal response, and should use that space
* Unlike 2009–10, any stimulus should be executed through the budget rather than the banking
system’

Further reading – do note that as of the morning of February 7th, China’s national broadsheets have not yet taken notice:

The IMF Issues A Chilling Warning About China’s Vulnerability To Europe (Business Insider, Feb 6, 2012)
Should such a tail risk of financial volatility emanating from Europe be realized, it would drag China’s growth lower. The channels of contagion would be felt mainly through trade, with knock-on effects to domestic demand.

China Risks 4-Point Growth-Rate Cut in Case of Europe Worsening: Economy (Bloomberg, Feb 6 2012)

China’s economic expansion would be cut almost in half if Europe’s debt crisis worsens, a scenario that would warrant “significant” fiscal stimulus from the nation’s government, the International Monetary Fund said.

– – –

Shanghai shipping slump as IMF warns China on euro slump
Shanghai shipping volumes contracted sharply in January as Europe’s debt crisis curbed demand for Asian goods, stoking fresh doubts about the strength of the Chinese economy.
By Ambrose Evans-Pritchard
Source – Telegraph, February 6, 2012

The shipping data came as the International Monetary Fund warned that China is vulnerable to the 'clear and present danger emanating from Europe'. Photo: ALAMY

The shipping specialist Lloyd’s List said container traffic through the Port of Shanghai – the world’s largest – fell by 100,000 boxes in January from a year earlier, or 4pc. Volumes fell by over one million tonnes.

The figures may have been distorted by China’s Lunar Year but there has been a relentless slide in the Shanghai transport data for months.

“China’s shipping markets face grievous challenges,” said the Shanghai International Shipping Institute. It acknowledged that the industry in the grip of downturn and likely to face a “worsening situation” in early 2012. Read the rest of this entry »

Filed under: Beijing Consensus, Chinese Model, Economics, European Union, Finance, Government & Policy, IMF, Influence, International Relations, Peaceful Development, Politics, Public Diplomacy, Soft Power, Strategy, Tao Guang Yang Hui (韬光养晦), Telegraph UK, Trade

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