Tuesday, April 6, 2021
Welcome to this week’s issue of China Briefing’s Belt & Road Initiative Weekly Investor Intelligence round up.
In this week’s edition, we provide a complimentary PDF of a very well received Guide to exploiting China’s Belt & Road Initiative (BRI), highlighting areas where foreign investment can take advantage of the opportunities created by the infrastructure build. We take a critical look at the reality behind the statements of US President Joe Biden’s pledge to build a ‘US financed Belt & Road’ and look at how China is taking steps to build the global management architecture for digital currencies. We also catch up on the Chinese Foreign Minister Wang Yi’s recent five nation tour of the Middle East and its implications, in addition to examining the purpose behind China’s doubling of rail freight through Russia in the first two months of 2021.
There is a lot going on and foreign investors can start to look at the BRI as an infrastructure gift and get involved in exploiting it – on a global basis.
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“I wish that this work finds its way on the desks of European industry associations and government cabinets so that they can all better understand how to be part of such an important international project.” – Michele Geraci, Former Undersecretary of State, Ministry of Economic Development, Government of Italy.
“Has raised the bar on coverage of this important topic.” – Daniel Widdicombe, Former Head of Investment Banking, China Construction Bank UK
No further details have been forthcoming about the US plans for its version of China’s Belt & Road external financing, which have now reached an estimated US$4 trillion. But there are significant differences, apparent even at the outset. Biden has stated that any such infrastructure investments will be restricted to ‘democratic states’ meaning that any US financing of global infrastructure needs is immediately politicized.
China’s Central Bank has proposed the application of global standards for the coming influx of sovereign digital currencies at the 2021 Bank for International Settlements (BIS) Innovation Summit held at the end of March. The outlined plan, titled ‘Global Sovereign Digital Currency Governance’ encompasses cross-border digital transactions, risk supervision, use and ownership of data, and other related financial and risk issues.
Full reports and analysis from Wang’s visits to Saudi Arabia, Turkey, Iran, United Arab Emirates, Bahrain, and Oman, with a US$400 billion Cooperation Agreement signed with Iran.
China has dramatically increased the shipment of goods to Europe using the railway infrastructure in Russia and Central Asia, with freight train transport doubling in the first two months of this year after seeing a similar surge in demand between 2019 and 2020, according to official data from China customs. Over 2,000 freight trains ran between China and Europe in January and February of 2021, about double the rate seen from last year.
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