Chinese Money Is Fleeing From The West To Emerging Markets In Asia, The Middle East, South America, And Africa

Wall Street Journal: Chinese Money Flees the Western World 

Just a few years ago, Chinese money was rippling across the rich world. Chinese investors were making blockbuster deals and snapping up trophy assets, from luxury homes and five-star hotels in New York to a Swiss chemical company and a German robotics giant. 

That era is over. 

Chinese investment is retreating from the West as hostility to Chinese capital has grown. Increasingly, Chinese companies are instead spending money on factories in Southeast Asia and mining and energy projects in Asia, the Middle East and South America, as Beijing seeks to cement alliances in those places and secure access to critical resources. 

The biggest recipient of Chinese investment so far this year is nickel-rich Indonesia, according to a preliminary estimate of Chinese investments compiled by the American Enterprise Institute, a conservative think tank, and viewed by The Wall Street Journal. Nickel is a key component in many of the batteries used to power electric vehicles.  

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Update: Chinese money pivoting away from West – WSJ (RT)  

WNU Editor: Besides investing in emerging markets in Asia, the Middle East, South America, and Africa. A lot of Chinese money is being invested in Russia.

EU Leaders Have Agreed To Reduce Their Economic Dependence On China

 

DW: EU leaders agree to cut reliance on China  

EU leaders at the Brussels summit also called on China to press Russia to end the conflict in Ukraine. But they failed to agree on a plan to distribute migrants in the bloc, after it was blocked by Poland and Hungary. 

European Union leaders pledged to reduce their economic dependence on China, as they concluded a two-day summit in Brussels on Friday. 

The bloc's leaders vowed to pursue a mutually beneficial economic relationship with Beijing that would "continue to reduce critical dependencies and vulnerabilities," they said in a joint statement. 

"We must prevent strategic dependencies. It will take a few years for companies to diversify, but it will remain an economic cooperation which is also necessary in terms of climate policies and food security," German Chancellor Olaf Scholz said.  

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Update #1: EU softens China strategy by adopting ‘de-risking’ approach (The Guardian)  

Update #2: EU leaders agree to 'de-risk' the bloc's trade dealings with China (SCMP)  

WNU Editor: Not everyone is onboard. Hungary's foreign minister Péter Szijjártó says that efforts by Europe to decouple or derisk from China would be an act of economic suicide (see video below). 

As to what is my take. 

The EU's economic/business model was based on obtaining cheap and relaible energy imports from Russia that in turn help make European products competitve in global markets and inflation in control. That model no longer exists, and targeting countries like China is not going to solve the economic problems that Europe is facing.

 

EU Weighs Changing Relations With China

DW: 'Pandora's box': EU weighs changing relations with China  

China's show of solidarity with Russia displeased officials in Brussels, where concerns are growing that Beijing is considering supplying arms to Moscow. 

But for now there is no real desire to decouple from China. If Xi Jinping chooses to "befriend a war criminal, it is our duty to get very serious about China," Lithuania's foreign minister, Gabrielius Landsbergis, told DW when asked what he thought about the Chinese president's three-day visit to Moscow and his meeting with his Russian counterpart Vladimir Putin. 

The International Criminal Court issued a warrant for Putin late last week, accusing him of war crimes. The only way forward for the European Union now, Landsbergis said, is to take "first steps on de-risking and eventual decoupling from China. The sooner we start, the better for the union."  

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Update #1: China's Russia ties after Xi visit to Moscow loom large as EU leaders gather for Brussels summit (SCMP)  

Update #2: China’s liaisons with Russia are fueling an awkward split among European leaders (CNBC)  

WNU Editor: EU sanctions on Russia has caused serious economic damage to the EU. Imposing sanctions on China will be disastrous.

U.S. And The E.U. Find Common Ground To Face China

 

Axios: U.S. and EU signal "converging" views on China 

The U.S. and the European Union are adopting "increasingly convergent" views on the threat posed by the Chinese government, according to senior Biden administration officials, deepening a trend that could tilt the scales in an era of great power competition.  

Why it matters: European leaders were initially wary of President Biden's campaign to rally a coalition of U.S. allies to challenge China, hoping to duck a confrontation between the bloc's two largest trading partners. 

But the winds in Europe seem to be shifting, in part due to Beijing's growing belligerence. Driving the news: The U.S. and EU released a lengthy joint statement on Thursday pledging "continuous and close contacts" to "manage our competition and systemic rivalry with China responsibly."  

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U.S. And The E.U. Find Common Ground To Face China 

US, EU concerned by China's 'problematic' actions at sea -- DW 

US, EU diplomats voice concern about China’s human rights abuses, aggression -- SCMP  

US, EU concerned at China’s ‘problematic’ actions in disputed sea -- Al Jazeera

EU Parliament Will Not Approve The EU - China Trade Deal as Tensions Grow Over Xinjiang, Hong Kong (Update)

 

VOA: EU Suspends China Trade Deal as Tensions Grow Over Xinjiang, Hong Kong  

LONDON - European and Chinese leaders are urging swift ratification of the trade deal they agreed to in December, after tensions over accusations of human rights abuses in China delayed approval of the deal by European Union lawmakers. 

The EU-China Comprehensive Agreement on Investment (CAI) took seven years of negotiations and was finally agreed to in principle December 30, 2020, following a virtual summit between EU and Chinese leaders. 

Europe said it was the most ambitious trade deal China had ever undertaken with a third party. 

However, EU Commission Executive Vice President Valdis Dombrovskis said last week that efforts to get the deal ratified by lawmakers in the European Parliament had been halted.  

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WNU Editor: Even though EU leaders are pressuring the European Parliament to approve the deal, my read of the Parliament is that the majority of members would rather see the deal in its current form die in committee. And as more details become known, support for this trade deal is losing ground.

European Union Says China Is Endangering The Peace In The South China Sea

Vessels from a People’s Liberation Army Navy fleet take part in a review in the South China Sea on Apr. 12, 2018. Visual China Group  

CNBC/Reuters: EU blames China for endangering peace in South China Sea 

* The EU last week released a new policy aimed at stepping up its influence in the Indo-Pacific region to counter China’s rising power. 

 * The Philippines on Friday protested to China over its failure to withdraw what it called as “threatening” boats believed to be manned by maritime militia around a disputed reef. 

* China is increasingly worried that Europe and other countries are heeding U.S. President Joe Biden’s call for a “coordinated approach” towards China. 

The European Union called out China on Saturday for endangering peace in the South China Sea and urged all parties to abide by a 2016 tribunal ruling which rejected most of China’s claim to sovereignty in the sea, but which Beijing has rejected. 

The EU last week released a new policy aimed at stepping up its influence in the Indo-Pacific region to counter China’s rising power.  

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WNU Editor: China is blaming the EU for raising tensions in the South China Sea .... EU should "stop sowing discord" in South China Sea: Chinese spokesperson (CGTN).  

Update: This could easily spread into a conflict that would engulf all of Asia .... US China Sea War Could Spread to Japan, Australia, India (Bloomberg)