- I understand Chinese loans to African countries are mostly collaterised by China having a secure hold on those African country's commodities, which China will have priority to extract and import as well, like Uranium, Cobalt and Copper. Even if these are priced in US$, China does not need paying the African countries, but just offsetting their import of such commodities against those loans. Just quite alike with China's deals with Russia and Iran, with oil for infrastructure, all avoiding payments having to go through the US$.
China is not that stupid to give US$ loans and asking to be repaid back specifically in US$, if no other way is possible. Being repaid all loans in US$ serves no purpose when China is already trying to recycle those surplus US$ accumulated from trade with the USA. That is the beauty of recycling the trade surpluses by China via the BRI projects, and that certainly rattled the USA. Some said that such loans have also been structured to be repaid in Yuan, but I am not so sure about this.
Lending to African countries and even getting paid back in worthless US$, can still always be recyled as loans to others later on, is still safer than keeping toxic treasuries that can afford the USA to have a hold on China in case of war. China may lose a huge sum if that happens, as shown by the US$300 billion stolen by the West from Russia.
Sure, give and take a few defaults by African countries of some billions, but it is still safer than losing all the trillions in treasury holdings in one big gamble. Countries will learn from what they see after the Russian experience.
Of course, nothing good has been written about those Chinese loans to Africa on MSM, all plain exaggeration like the debt trap hubris. But listening to the Africans themselves, you will get a diametrically different perspective. Straight from the horses mouth is way more trustworthy than believing in fabricated gloom and doom. China has been a great competitor to IMF and World Bank, with the formation of the AIIB and coming up with the BRI idea, and we can expect no different reaction from the West, media and all. - Anonymous
In return for its investments in Africa, China is new reaping its rewards. Essential minerals and mining rights have mostly gone to the Chinese, and the USA and Europeans are nervous and erratic in their behavior.
ReplyDeleteThe West now wants to co-operate in a big way with Africa, but the Africans are not that stupid to fall for false pretences under fake promises. That is already a lesson well learnt by the Africans. Shame on the West for fooling them once, and shame on the Africans if they are being fooled again.
Who does not welcome investments that can help to improve infrastructures, lift people out of poverty and expertise coming in to help extract resources to the benefit of both sides, rather than being colonised by someone out to steal all the resources for themselves and keeping the country poor and helpless, with little means to progress?
Let us watch how Demented Crazy Old Joe and when he is starting his digital transformation of Africa with his US$350 billion pledge, oops sorry that had been devalued to US$350 million hot air, to do the job. US$7 million for each country is enough for the digital transformation? Keep dreaming if you believe so.
After stealing Africa resources and catching Africans as slaves for their cotton fields, Blinken is now visiting African trying to con the Africans that China is there to steal their resources and Americans are there to protect them.
ReplyDeleteThey stole and accused others of stealing. They started wars and accused others of starting wars. They are expansionist and aggressive and accused others of expansionist and aggressive. They are warmongers and accused others of warmongering. They are the world's number terrorist state and accused others of terrorism.
That is the USA, the Americans. The Empire of Lies.
Everyone seems to be on a trajectory to reject the US dollar. India is buying Russian oil for Rupees and Yuan; Brazil and Argentina — two largest economies in Latin America — are discussing a “common currency” for trade; and Putin is talking about BRICS+ creating a currency based on commodities. President Xi’s visit with Saudi and GCC (Gulf Cooperation Council) marks the birth of the petroyuan. By 2025, the GCC may be paid in renminbi for all of the oil and gas.
ReplyDelete“If less trade is invoiced in US dollars and there is a dwindling recycling of dollar into Treasuries, the “exorbitant privilege” that the dollar holds as the reserve currency could be under assault,” says Credit Suisse’s financial guru Zoltan Pozsar.
Meanwhile, the United States will be spending $800 billion this year on just interest payments on its untenable debt.
U.S. trade deficit for goods will be $1.2 trillion in 2022. Meanwhile, China had a record trade surplus of $877 billion. Which economic model is sustainable?
America’s decline will certainly be quite precipitous globally after its loss of dollar hegemony. The world is at a crossroads. The 500-year-old Western domination — that started with Europeans landing in the Americas — is now coming to an end.
The Ukraine war is all about saving the American world order and extending Pax Americana. The USA is hoping for an escalated proxy war that destroys Russia, which will then be occupied by US military and ruled by pro-US puppets. Repeat of what happened to Europe, Germany, Japan etc. after WW2 or to South Korea a decade later. The only solution for the US to extricate itself out of this spiraling crisis is wars where others destroy themselves.
The US is not going to stop the proxy war, since it’s an existential crisis for the American Empire. Russia’s victory means the surge of a multipolar world that is now nascent, and end of the dollar hegemony as well as the American Century. Thus, the US will keep escalating — sending more tanks, drones, rocket launchers, long-range missiles, missile defense systems, and even fighter jets.
True. Russia's victory in Ukraine will spell the emergence of a multipolar world. Despite all the support for Ukraine, and with everyone knowing this is a proxy war fought between the USA and Nato against Russia, a win for Russia is a big setback for USA and Nato. The USA is undeniabily fighting a life and death battle against losing the US$ hegemony, if Ukraine collapses and Europe disintegrates, and with that, support for the US$ hegemony will shrink further.
ReplyDeleteRussia's defeat would inevitably also weaken China's confrontation with the USA, enabling full USA pivoting towards China, and the world must ensure and hope this does not happen. The USA had been trying desperately to coax China to steer away from supporting Russia, even threatening China over any support given, but it will never suceed. The Russians and Chinese have gone through their plan for years on coming together to upend the US$ hegemony. The reality on the ground is that Ukraine cannot possibly last much longer, judging from the begging by Zelenskyy, day in and day out, for weapons and support.
Antony Blinken is scheduled to visit Beijing on February 5 and 6, said to lower the tension between USA and China. That is a joke and just eyewash. This is no 'long time no see' meeting and will be delicate for Blinken to tread. That lowering of tension bleat is also sending a glaring contradictory message by the USA to China, especially when Kevin McCarthy is intending to visit Taiwan later. What will Blinken say to the Chinese if they were to ask about the impending visit to Taiwan by McCarthy? Perhaps 'Smile, I am on Candid Camera' would do the trick. Blinken is in for a roasting like the one in Anchorage, Alaska.
You see, the two Parties in Washington are trying to outdo the other, on who can antagonise Russia and China better. That is their way of winning votes in 2024. The Democrats and Republicans alike, need to use a bogeymen to carry their voters support on policies. Democrats need the Russian punching bag and Republicans need the Chinese punching bag. They sometimes use both for better effect.
Fact 1. Russia cannot lose. If Russia is on the point of losing, it would use nuclear weapons to wipe out Europe, if not USA as well.
ReplyDeleteFact 2. It is America/Nato against Russia, backed by Russia's allies. The Americans have poured in hundreds of billions into the war. Nato countries are contributing to the war. It is no longer a proxy war.
Blinken going to threaten China, with Nimitz aircraft carrier in the Philippines Sea, that they would stop McCarthy from visiting Taiwan if China stops supporting Russia. China would show him the middle finger. China is prepared to sink the Nimitz and can do it anytime.
Fact 3. No American military threat can work against China today. China will strike back when attacked. China is waiting for a reason to avenge the attack on its Belgrade Embassy in 1999. Just try, America, and see what would hit you. See if Nimitz would still be floating with its 6,000 men and hundreds of aircraft on it.
Russia said, no US$ for oil, we only accept Rubles. China and Russia said, lets do the energy trade using Yuan and Ruble, including barter, and they did that and so US$400 billion deal was done outside the US$, with much more in the interim. Iran said to China, we let you have oil, you do infrastructure for us. And they agreed and another US$400 billion oil deal bypassed the US$. What about India and Russia using Rubles and Rupees? No problem there as well.
ReplyDeleteSo, what is the problem? No US$ also can. Yes they still accept US$, as they accept any other currencies, but what is the message those countries are trying to say?
Let us be honest. The end of US$ hegemony will bring in chaos for the world initially. No doubt about that and that goes for major changes in any arrangement that has been going on for decades.
ReplyDeleteJanet Yellen is using that as a threat to the rest of the world against ditching of USA Treasuries and bringing down the US$ hegemony system.
On the other hand, it is a matter of weighing the pros and cons of such an event. It is either a short term pain of adopting a new and fairer system, or continue to live in long term pain with a system that is skewed and taken advantage of on all fronts by the USA. Every country, big and small, will one day suffer the same fate as Cuba, Venezuela, North Korea, Iran, Afghanistan and now Russia.
The choice is now there for the world to choose, and Russia and China have given the world a cover and a chance to have their day to reckon with the US$ curse, without having to suffer the likes of Iraq and Libya.