Archive for the ‘China’ Category

China Just Issued A Stark Warning To North Korea That Changes Everything

Behind China’s $1 Trillion Plan to Shake Up the Economic Order

Chinese workers and engineers at a tunnel being created near Vang Vieng, Laos, as part of a $6 billion Chinese rail project that will connect eight Asian countries. CreditAdam Dean for The New York Times

VANG VIENG, Laos — Along the jungle-covered mountains of Laos, squads of Chinese engineers are drilling hundreds of tunnels and bridges to support a 260-mile railway, a $6 billion project that will eventually connect eight Asian countries.

Chinese money is building power plants in Pakistan to address chronic electricity shortages, part of an expected $46 billion worth of investment.

Chinese planners are mapping out train lines from Budapest to Belgrade, Serbia, providing another artery for Chinese goods flowing into Europe through a Chinese-owned port in Greece.

The massive infrastructure projects, along with hundreds of others across Asia, Africa and Europe, form the backbone of China’s ambitious economic and geopolitical agenda. President Xi Jinping of China is literally and figuratively forging ties, creating new markets for the country’s construction companies and exporting its model of state-led development in a quest to create deep economic connections and strong diplomatic relationships.

The initiative, called “One Belt, One Road,” looms on a scope and scale with little precedent in modern history, promising more than $1 trillion in infrastructure and spanning more than 60 countries. To celebrate China’s new global influence, Mr. Xi is gathering dozens of state leaders, including President Vladimir V. Putin of Russia, in Beijing on Sunday

Mr. Xi is aiming to use China’s wealth and industrial know-how to create a new kind of globalization that will dispense with the rules of the aging Western-dominated institutions. The goal is to refashion the global economic order, drawing countries and companies more tightly into China’s orbit.

A Chinese worker welding a tube for a new rail bridge near Vang Vieng. CreditAdam Dean for The New York Times

The projects inherently serve China’s economic interests. With growth slowing at home, China is producing more steel, cement and machinery than the country needs. So Mr. Xi is looking to the rest of the world, particularly developing countries, to keep its economic engine going.

“President Xi believes this is a long-term plan that will involve the current and future generations to propel Chinese and global economic growth,” said Cao Wenlian, director general of the International Cooperation Center of the National Development and Reform Commission, a group dedicated to the initiative. “The plan is to lead the new globalization 2.0.”

Mr. Xi is rolling out a more audacious version of the Marshall Plan, America’s postwar reconstruction effort. Back then, the United States extended vast amounts of aid to secure alliances in Europe. China is deploying hundreds of billions of dollars of state-backed loans in the hope of winning new friends around the world, this time without requiring military obligations.

Mr. Xi’s plan stands in stark contrast to President Trump and his “America First” mantra. The Trump administration walked away from the Trans-Pacific Partnership, the American-led trade pact that was envisioned as a buttress against China’s growing influence.

“Pursuing protectionism is just like locking oneself in a dark room,” Mr. Xi told business leaders at the World Economic Forum in January.

As head of the Communist Party, Mr. Xi is promoting global leadership in China’s own image, emphasizing economic efficiency and government intervention. And China is corralling all manner of infrastructure projects under the plan’s broad umbrella, without necessarily ponying up the funds.

The bridge site near Vang Vieng. The work is a small piece of China’s “One Belt, One Road” initiative, whose scope and scale has little precedent in modern history. CreditAdam Dean for The New York Times

China is moving so fast and thinking so big that it is willing to make short-term missteps for what it calculates to be long-term gains. Even financially dubious projects in corruption-ridden countries like Pakistan and Kenya make sense for military and diplomatic reasons.

The United States and many of its major European and Asian allies have taken a cautious approach to the project, leery of bending to China’s strategic goals. Some, like Australia, have rebuffed Beijing’s requests to sign up for the plan. Despite projects on its turf, India is uneasy because Chinese-built roads will run through disputed territory in Pakistan-occupied Kashmir.

But it is impossible for any foreign leader, multinational executive or international banker to ignore China’s push to remake global trade.

Germany’s minister of economics and energy, Brigitte Zypries, plans to attend the meeting in Beijing. Western industrial giants like General Electric and Siemens are coming, as they look for lucrative contracts and try to stay in China’s good graces.

The Trump administration just upgraded its participation.

Originally, it planned to send a Commerce Department official, Eric Branstad, the son of the incoming American ambassador to Beijing, Terry Branstad. Now, Matthew Pottinger, senior director for Asia at the National Security Council, will attend instead — a signal that the White House is enhancing its warm relationship with Mr. Xi by honoring his favorite endeavor with the presence of a top official.

Influence Via Infrastructure

As the sun beat down on Chinese workers driving bulldozers, four huge tractor-trailers rolled into a storage area here in Vang Vieng, a difficult three-hour drive over potholed roads from the capital, Vientiane. They each carried massive coils of steel wire.

China’s Global Ambitions

Under the “One Belt, One Road” plan, President Xi Jinping is remaking global trade and nurturing geopolitical ties. The audacious plan, with little precedent, promises more than $1 trillion in infrastructure investments that span 60-plus countries across Europe, Asia and Africa.

Half a mile away, a Chinese cement mixing plant with four bays glistened in the sun. Nearby, along a newly laid road, another Chinese factory was providing cement for tunnel construction.

Nearly everything for the Laos project is made in China. Almost all the labor force is Chinese. At the peak of construction, there will be an estimated 100,000 Chinese workers.

When Mr. Xi announced the “One Belt, One Road” plan in September 2013, it was clear that Beijing needed to do something for the industries that had succeeded in building China’s new cities, railways and roads — state-led investment that turned it into an economic powerhouse. China did not have a lot left to build, and growth started to sputter.

Along with the economic boost, tiny Laos, a landlocked country with six million people, is a linchpin in Beijing’s strategy to chip away at American power in Southeast Asia. After Mr. Trump abandoned the Trans-Pacific Partnership in January, American influence in the region is seen to be waning. The rail line through Laos would provide a link to countries that China wants to bring firmly into its fold.

Each nation in Mr. Xi’s plan brings its own strategic advantages.

The power plants in Pakistan, as well as upgrades to a major highway and a $1 billion port expansion, are a political bulwark. By prompting growth in Pakistan, China wants to blunt the spread of Pakistan’s terrorists across the border into the Xinjiang region, where a restive Muslim population of Uighurs resides. It has military benefits, providing China’s navy future access to a remote port at Gwadar managed by a state-backed Chinese company with a 40-year contract.

Many countries in the program have serious needs. The Asian Development Bank estimated that emerging Asian economies need $1.7 trillion per year in infrastructure to maintain growth, tackle poverty and respond to climate change.

In Kenya, China is upgrading a railway from the port of Mombasa to Nairobi that will make it easier to get Chinese goods into the country. The Kenyan government had been unable to persuade others to do the job, whereas China has been transforming crumbling infrastructure in Africa for more than a decade.

The rail line, which is set to start running next month, is the first to be built to Chinese standards outside China. The country will benefit for years from maintenance contracts.

“China’s Belt and Road initiative is starting to deliver useful infrastructure, bringing new trade routes and better connectivity to Asia and Europe,” said Tom Miller, author of “China’s Asian Dream: Empire Building Along the New Silk Road.” “But Xi will struggle to persuade skeptical countries that the initiative is not a smokescreen for strategic control.”

Calculating the Risks

Although Chinese engineers just started arriving in this tourist townseveral months ago, they have started punching three tunnels into mountains that slope down to roiling river water. They are in a race to get as much done as possible before the monsoon rains next month slow down work.

It is a fast start to a much-delayed program that may bring only limited benefits to the agrarian country.

For years, Laos and China sparred over financing. With the cost running at nearly $6 billion, officials in Laos wondered how they would afford their share. The country’s output is just $12 billion annually. A feasibility study by a Chinese company said the railway would lose money for the first 11 years.

Such friction is characteristic.

In Indonesia, construction of a high-speed railway between Jakarta and Bandung finally began last month after arguments over land acquisition. In Thailand, the government is demanding better terms for a vital railway.

China’s outlays for the plan so far have been modest: Only $50 billion has been spent, an “extremely small” amount relative to China’s domestic investment program, said Nicholas R. Lardy, a China specialist at the Peterson Institute for International Economics in Washington.

Even China’s good friends so far are left wanting. Mr. Xi attended a groundbreaking ceremony in 2014 in Tajikistan for a gas pipeline, but the project stalled after Beijing’s demand waned.

Mr. Putin will be at the center of the Beijing conference. While two companies owned by one of his closest friends, Gennady Timchenko, have benefited from projects, there has not been much else for Russia.

“Russia’s elites’ high expectations regarding Belt and Road have gone through a severe reality check, and now oligarchs and officials are skeptical about practical results,” said Alexander Gabuev, senior associate at the Carnegie Center in Moscow.

China is making calculations that the benefits will outweigh the risks.

The investments could complicate Beijing’s effort to stem the exodus of capital outflow that have been weighing on the economy. The cost could also come back to haunt China, whose banks are being pressed to lend to projects that they find less than desirable. By some estimates, over half the countries that have accepted Belt and Road projects have credit ratings below investment grade.

“A major constraint in investor enthusiasm,” said Eswar Prasad, professor of trade policy at Cornell University, “is that many countries in the Central Asian region, where the initial thrust of the initiative is focused, suffer from weak and unstable economies, poor public governance, political stability and corruption.”

Laos is one of the risky partners. The Communist government is a longstanding friend of China. But fearing China’s domination, Laos is casting around for other friends as well, including China’s regional rivals Japan and Vietnam.

After five years of negotiations over the rail line, Laos finally got a better deal. Laos has an $800 million loan from China’s Export-Import Bank and agreed to form a joint venture with China that will borrow much of the rest.

Still, Laos faces a huge debt burden. The International Monetary Fund warned this year that the country’s reserves stood at two months of prospective imports of goods and services. It also expressed concerns that public debt could rise to around 70 percent of the economy.

As construction gathers steam, nearby communities are starting to rumble.

Farmers are balking at giving up their land. Some members of the national assembly have raised questions about property rights.

At Miss Mai’s Noodle Shop here, a customer, Mr. Sipaseuth, who said he used only one name, pondered the project over a glass of icy Beer Lao.

In the past, he said, the government had promised $10 for an acre of land worth about $100. “But then they never paid it,” Mr. Sipaseuth added.

Was the rail project good for Laos?

“We need civilization. Laos is very poor, very underdeveloped,” he said. “But how many Chinese will come here? Too many is not a good idea.”

JUST IN: China STUNS World, Issues Shocking Military Threat To North Korea

On most days, China is considered one of a limited number of countries around the world who are considered friendly with North Korea.

But mysteriously, just day after President Trump’s meeting with Chinese President Xi Jinping, the communist country just flipped the script on their unruly neighbors to the south. This could get ugly, quick.

The Daily Caller reports:

If North Korea crosses Beijing’s “bottom line,” China may bomb its neighbor.

China warns the North’s nuclear activities must not jeopardize northeastern China. If North Korea negatively impacts China with its illicit nuclear activities, the latter will respond with force, a Global Times editorial published on the news service for the Chinese military stressed.

“China has a bottom line that it will protect at all costs, that is, the security and stability of northeast China,” the report stated. “If the bottom line is touched, China will employ all means available including the military means to strike back … By that time, it is not an issue of discussion whether China acquiesces in the US’ blows, but the Chinese People’s Liberation Army (PLA) will launch attacks [on] DPRK nuclear facilities on its own.”

The northeastern provinces of Liaoning and Jilin border North Korea. Together with Heilongjiang Province, the three provinces make up the Shenyang Military Region.

“We all know that the DPRK’s sixth nuclear test is imminent, and various parties, especially China, are generally worried about this,” the editorial commented.


South Korean Paper Reports China Has Deployed 150,000 Troops To North Korea Border

Soldiers from Chinese People’s Liberation Army (PLA) Special Operations Forces 

While the catalyst is unclear, it appears the market dropped as headlines of further sanctions against Russia appeared and reports of China deploiying 150,000 troops to its North Korea border.

According to Korean news agency Chosun, the “Chinese army has deployed about 150,000 troops to the North Korean border in two groups to prepare for unforeseen circumstances.” The reason: the prospect of “military options”, such as preemptive attacks on North Korea, like the one the United States launched on Syria.

More Google translated:

As the United States announced its independent North Korean behavior and moved the United States Navy’s nuclear-powered Calvinus (CVN-70) carrier class to Singapore, the Chinese army has deployed about 150,000 troops in two groups to prepare for unforeseen circumstances.

The report said. It is because of the prospect of taking “military options”, such as preemptive attacks on North Korea, just as the United States has launched an air raid on Syria.

Japan’s Sankei Shimbun reported on the 9th that the Syrian missile strike in the United States shocked China, suggesting that the People’s Liberation Army forces are moving toward the Yalu River, .

The newspaper said the video was also broadcast on the Internet, but the authorities removed the relevant information, saying the move was a medical and aft support unit for the Shenyang bulb (the northern light bulb)

Another possible catalyst is a report by Russia’s interfax that Moscow is preparing for more sanctions, and has warned local air companies about a possible suspension of charter flights with Tu


Whatever the catalyst, the reaction is clear:


China's New Aircraft Carrier


The following comment from an American Observer who viewed the illustrations above;
“This is a quantum leap above anything we have on the drawing board. They have thought “outside the box” on this one. Better speed, larger capacity, much more stable, etc. Definitely a “blue-water” long reach vessel. Plus they can service their nuke sub fleet in-between the twin hulls (sight unseen) or even launch amphibious ops from same. It will be launched in half the time it takes the USA at just one-third the cost. Add the new Chinese stealth fighter bomber (naval version already flight-testing) in the mix and you have the makings of a formidable weapons system indeed. Also look at that extra ”parking and readiness” station between both hull structures. And of course the launching and landing capabilities from the utilization of twin flight decks at once.

Six of these vessels (two pacific, two Atlantic, one Indian ocean and one on the Mediterranean sea ) would be a pretty good diplomatic “big stick.” Note: the Chinese are already drilling for oil off Cuba, Brazil andVenezuela. Can they build a fleet of these things?

A few facts: the Chinese have completed the world’s biggest dam (three gorges), the world’s longest over-water bridge (65 times as much steel as in the Eiffel tower), constructed a 15,000 ft. High railroad into Tibet(all considered major engineering feats).

China is the only nation other than Russia that can launch men into outer space. They have also shot down a surveillance satellite (one of their own) from the ground. Plus, they “own our arses” in the international debt game.

China ‘s new carrier could be twice as fast as anything we have, plus the stability of a catamaran type hull will greatly reduce the pitching, yawing and swaying common to our present designs.

Still want to say: “Junk made in China?”


MILWAUKEE, Wisconsin — GOP frontrunner Donald Trump is releasing his policy plan to protect American workers and businesses from China’s destructive currency manipulation and financial policies.

The move hints he’s planning to come out guns-a-blazing on trade policies at the Fox Business Network debate here in Milwaukee on Tuesday evening.

The hallmark of the plan is a tough guy approach only Trump can pull off with regard to dealing with China. Titled, “Reforming The U.S.-China Trade Relationship To Make America Great Again,” the plan opens with an explanation of what Trump says caused America to start getting beat by China on the world stage in trade policy.

Under a section that details how “Washington Politicians Let China Off The Hook,” Trump puts much of the blame of former Secretary of State Hillary Clinton’s husband Bill Clinton and actions he took at the end of his administration.

“In January 2000, President Bill Clinton boldly promised China’s inclusion in the World Trade Organization (WTO) ‘is a good deal for America. Our products will gain better access to China’s market, and every sector from agriculture, to telecommunications, to automobiles. But China gains no new market access to the United States,’” Trump writes.

None of what President Clinton promised came true. Since China joined the WTO, Americans have witnessed the closure of more than 50,000 factories and the loss of tens of millions of jobs. It was not a good deal for America then and it’s a bad deal now. It is a typical example of how politicians in Washington have failed our country.

Trump said that the thing Americans need most in dealing with China on trade is “leadership” in negotiations—leadership that’s been sorely lacking for the last couple decades.

“The most important component of our China policy is leadership and strength at the negotiating table,” Trump writes.

We have been too afraid to protect and advance American interests and to challenge China to live up to its obligations. We need smart negotiators who will serve the interests of American workers – not Wall Street insiders that want to move U.S. manufacturing and investment offshore.

Trump says that under his administration if he’s elected, “trade will flourish” because he will ensure that free trade is also “fair trade.”

“Our goal is not protectionism but accountability,” Trump writes.

America fully opened its markets to China but China has not reciprocated. Its Great Wall of Protectionism uses unlawful tariff and non-tariff barriers to keep American companies out of China and to tilt the playing field in their favor. If you give American workers a level playing field, they will win. At its heart, this plan is a negotiating strategy to bring fairness to our trade with China.

The results will be huge for American businesses and workers. Jobs and factories will stop moving offshore and instead stay here at home. The economy will boom. The steps outlined in this plan will make that a reality. When Donald J. Trump is president, China will be on notice that America is back in the global leadership business and that their days of currency manipulation and cheating are over. We will cut a better deal with China that helps American businesses and workers compete.

Then, before getting into the details of his trade plan policies, Trump lays out four specific goals he is seeking to achieve on behalf of Americans.

First, he wants to “bring China to the bargaining table by immediately declaring it a currency manipulator.”

Second, he wants to “protect American ingenuity and investment by forcing China to uphold intellectual property laws and stop their unfair and unlawful practice of forcing U.S. companies to share proprietary technology with Chinese competitors as a condition of entry to China’s market.”

Third, Trump wants to “reclaim millions of American jobs” and revive “American manufacturing by putting an end to China’s illegal export subsidies and lax labor and environmental standards.” Trump says there will be “no more sweatshops or pollution havens stealing jobs from American workers.”

And fourth, Trump aims to “strengthen our negotiating position by lowering our corporate tax rate to keep American companies and jobs here at home, attacking our debt and deficit so China cannot use financial blackmail against us, and bolstering the U.S. military presence in the East and South China Seas to discourage Chinese adventurism.”

From there, Trump gets in the details of his plan. He lays out how on “day one” of his presidency, he’d “designate China as a currency manipulator.”

“We need a president who will not succumb to the financial blackmail of a Communist dictatorship. President Obama’s Treasury Department has repeatedly refused to brand China a currency manipulator – a move that would force China to stop these unfair practices or face tough countervailing duties that level the playing field,” Trump writes.

Economists estimate the Chinese yuan is undervalued by anywhere from 15 percent to 40 percent. This grossly undervalued yuan gives Chinese exporters a huge advantage while imposing the equivalent of a heavy tariff on U.S. exports to China. Such currency manipulation, in concert with China’s other unfair practices, has resulted in chronic U.S. trade deficits, a severe weakening of the U.S. manufacturing base and the loss of tens of millions of American jobs.

Trump says there will be a “zero tolerance” policy for intellectual property theft by Chinese interests.

“China’s ongoing theft of intellectual property may be the greatest transfer of wealth in history,” Trump says.

This theft costs the U.S. over $300 billion and millions of jobs each year. China’s government ignores this rampant cybercrime and, in other cases, actively encourages or even sponsors it –without any real consequences. China’s cyber lawlessness threatens our prosperity, privacy and national security. We will enforce stronger protections against Chinese hackers and counterfeit goods and our responses to Chinese theft will be swift, robust, and unequivocal.

Trump would also end China’s “illegal export subsidies” that he says “intentionally distorts international trade and damages other countries’ exports by giving Chinese companies an unfair advantage.”

Because of these actions by China, companies and workers across America are hurt financially. “From textile and steel mills in the Carolinas to the Gulf Coast’s shrimp and fish industries to the Midwest manufacturing belt and California’s agribusiness, China’s disregard for WTO rules hurt every corner of America,” Trump writes.

Trump has been the most anti-Obamatrade candidate in the entire 2016 presidential field. In an interview on Monday, Trump told Breitbart News that he thinks Obamatrade’s Trans Pacific Partnership (TPP) is “insanity.”

Trade policy is right in Trump’s wheelhouse as an international businessman, offering him an opportunity to draw sharp contrasts with fellow outsiders like Dr. Ben Carson—who has signaled he is open to the TPP deal—and with career politicians like Sen. Marco Rubio (R-FL)80%
, who many times this year said he supported TPP specifically before his staff said late last week that he wasn’t yet decided.

China Collapse Worse than Greece?

Australia media is reporting on a China collapse that might be “monstrous.”

An Australian news outlet is reporting, “Chinese chaos worse than Greece.”

WHILE the world worries about Greece, there’s an even bigger problem closer to home: China.

A stock market crash there has seen $3.2 trillion wiped from the value of Chinese shares in just three weeks, triggering an emergency response from the government and warnings of “monstrous” public disorder.

And the effects for Australia could be serious, affecting our key commodity exports and sparking the beginning of a period of recession-like conditions.

“State-owned newspapers have used their strongest language yet, telling people ‘not to lose their minds’ and ‘not to bury themselves in horror and anxiety’. [Our] positive measures will take time to produce results,” writes IG Markets.

“If China does not find support today, the disorder could be monstrous.”

In an extraordinary move, the People’s Bank of China has begun lending money to investors to buy shares in the flailing market. The Wall Street Journal reports this “liquidity assistance” will be provided to the regulator-owned China Securities Finance Corp, which will lend the money to brokerages, which will in turn lend to investors.

Loaning money to people to buy stock in order to try to boost stock prices sound like an incredibly desperate move. And if the government media is admitting that people are in danger of losing their minds and burying themselves in horror and anxiety, the situation must be really bad.

So now we have China added to the list with Greece and Puerto Rico. We know that in Europe there are other nations waiting to collapse after Greece does. Likewise, there are states and cities in the United States that are also effectively insolvent.

I have no way of timing all these things perfectly, but it does seem like the financial problems are accelerating and amplifying one another.


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