Great article. Strongly recommend. Belt and Road is, above all else, China exporting its own post 09 stimulus domestic political economy.https://twitter.com/andrewbatson/status/1123943277659664384 …
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Brad Setser Retweeted Andrew Batson
Great article. Strongly recommend. Belt and Road is, above all else, China exporting its own post 09 stimulus domestic political economy.https://twitter.com/andrewbatson/status/1123943277659664384 …
Brad Setser added,
CDB is a critical link -- part of China's local government-infrastructure-SoE complex, and its global infrastructure-SoE complex. https://andrewbatson.com/2019/05/02/the-belt-and-road-is-about-domestic-interest-groups-not-development/ …pic.twitter.com/tP6afXcQBf
This article should spawn multiple Ph.D. dissertations. It is that good.
I will add a couple of points of my own -- the Belt and Road also emerged out of China's efforts to find other things to do with its "spare" reserves after the global crisis.pic.twitter.com/Tai370DQoW
And I suspect, for fairly obvious reasons, channeling those reserves to the CDB to support lending whose benefits flowed back to Chinese domestic interests had more domestic interest group support than just buying (US) Treasuries ...pic.twitter.com/onBSp1gMIH
Are most of the Belt and Road loans denominated in RMB, USD or local currencies? It could have profound impacts on trade, investment and currencies for decades to come
no good data to my knowledge. think mostly USD. but a guess. China really should be more transparent here (and if there is data, do let me know)
I think they're denominated in RMB actually. That is to China's benefit and consistent with their attempt to internationalize and turn the RMB into a reserve currency https://eng.yidaiyilu.gov.cn/ghsl/wksl/76393.htm …pic.twitter.com/QdasJfMJQu
CDB reports pretty significant fx assets on its balance sheets, and the fx balance sheet data of China shows rapidly growing fx loans abroad -- so relative balance not entirely clear. would be good to have more numbers from CDB and China Exim
I see. I kept googling and came across this line "most CDB and China Exim loans are denominated in dollars or renminbi." Seems like a mix.
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