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123tom, >> warnings about September <<
Yes, Sept/Oct does seem like a favorite time for disasters to appear, in financial markets and otherwise. Many of the so-called global 'elites' who have been running things are really into the occult. Did you see that video of IMF chief Christine Lagarde going on about the 'numerology of 7'? I was thinking, what the heck, but that's what you get from folks who gather every year at the Bohemian Grove.
Concerning gold, yes it looks like a great opportunity to accumulate. Whatever the operative plan is to derail the BRICS, I figure it will happen within the next few years. After that the BRICS juggernaut will be completely unstoppable. The US dollar has already lost its standing as the trade currency among the BRICS and their trading partners, and when the Saudis decide to start selling oil to China using the Yuan (as Russia has this year), it's over for the petro-dollar system and US world hegemony.
Apparently the Western globalists believed they could orchestrate a global financial crisis via derivatives, with the world thus falling into chaos and forced into a global IMF bailout, with the IMF's SDR/Special Drawing Rights coming to the rescue (see Jim Rickards). The BRICS would thus be brought to heel, and Western hegemony could continue on via US/European combined voting control at the IMF. But whether that's still the plan or not, who knows. At this point, all the options for stopping the BRICS look like highly risky desperation plays.
Goooood Morning Vietnam......
what do you think of this idea.... maybe some day. ... after the next crash ?
http://www.silverdoctors.com/wish-youd-jumped-on-the-china-boom-20-years-ago-heres-your-second-chance-in-vietnam/
Interesting comments gfp.... we do live in interesting times thats for sure. Empires changing.
I suspect trouble around every corner. at this point. Spot gold...I do follow it closely , the metals and miners.
I was one of those who were only about 6 years early.in the "safe haven" investment.
There is a big pivot target for gold around 975 but I dont know if it will get there. 1000 tested seems possible, but for sure the 1050 target zone. whats the bottom so far now is it 1072?
I dont mind buying here.
China gold panda are 80 dollars over spot now. Maples are about 40 over spot.
Do you pay much attention to all the spooky hype warnings about september 23 and impending market crisis this fall? I think the timing does deserve careful watching.
123tom, Thanks for the link, looks like a great site. I'm pulling for the BRICS, but wonder how the Western luminaries plan to deal with it/wreck it? There hasn't been a challenge to the existing order of this magnitude since the rise of Germany threatened the British Empire in the early 20th century.
I see you follow gold. Chart-wise, looks like a test of 1000 is likely in the cards in the months ahead, barring a big global meltdown or other crisis. Below that, support looks like the 700-1000 area.
>>> Building BRICS: A steady, cautious march ahead
Special to The BRICS Post
July 10, 2015
http://thebricspost.com/building-brics-a-steady-cautious-march-ahead/#.VbZJaf3bLhs
The 2015 Ufa BRICS summit is unique in a sense that it proved to be a test of maturity of this association.
For the first time in the summits’ short history, there is a marked division in its members’ relations with the world’s current dominant force – a global West headed by the United States.
Russia’s relations with the West are on the verge of a full scale conflict, while increasing Chinese-authorized foreign policy, including its regional dimension in Asia is fueling US frustrations – which has considerably increased after the ascension of Xi Jinping to the seat of power in Beijing.
At the same time, the Indian government led by Narendra Modi, is pursuing a multi-vector policy, which includes rapprochement with Washington while trying to extract the most from other partners, including BRICS.
Brazil’s President, prior to the Russian trip, visited the US ending a period of chilly relations since 2013, when the Snowden revelations of US spying came to the fore.
With Brazil’s economic slowdown, and the internal political feud, Brasilia is now less than ever inclined to do something unpleasant to the USA, that includes too vocal a support of Russia.
South Africa, the S in the BRICS, is predominantly concerned with economic issues and still views BRICS as an instrument for promoting bilateral relations and the country’s global profile.
Therefore, we can hardly postulate that 2015 was about furthering the evolution of a common bloc of anti-Western nature.
Russia, of course, was strongly tempted to use the Ufa summit as proof of absence of its diplomatic isolation and solicit support in its standoff with the West- something that other BRICS member countries are reluctant to put on the forefront.
Russia therefore had to be extremely cautious not to put its BRICS partners in an awkward position, limiting their support to the Ukrainian standoff to pledges to solve the crisis in a peaceful manner by implementing the Minsk agreements.
Moscow is also genuinely thankful for the BRICS denunciation of sanctions- which, practically, can do little to change the Western policy of imposing sanctions at will.
So it is not likely the most favorable time to push the non-Western identity of the BRICS group.
However, lest we lose sight of this important fact — the leaders of the most populous countries agree on approaches to numerous regional conflicts and security. BRICS cooperation is, therefore, a manifestation of a shift in geopolitical reality.
The “double” summit of BRICS and SCO underlines the fact that a new power arrangement is being born in the globe’s “heartland”.
This is something that will aim to make a US -dominated unipolar world order less and less feasible.
However- and this is increasingly stressed by BRICS – it is not directed against the West- without cooperation with which their own development is impossible.
BRICS do not want the ‘destruction’ of the current global governance system, but rather, a fair place in it.
Frustratingly, however, the search of compromise with the West, for example within the G20 or IMF framework, has up till now been far from successful.
BRICS countries therefore have created parallel structures- like the New Development bank and Currency reserve arrangements, which are the first instances of getting out of the West’s egoistic dominance in world affairs.
More is to follow in different areas- ranging from independent rating agencies to information security system.
BRICS strategy is therefore two-pronged and is addressed both at the North and South.
At the same time, BRICS is consolidating its common approach to a number of global issues while its economic agenda becomes more comprehensive with each passing month.
A score of new agreements (including the formal “BRICS Economic Strategy” roadmap ) and intra-BRICS countries contracts and agreements are the result of the meetings in Ufa.
In successfully leveraging the summit, BRICS further consolidates its positions and power in reforming the global financial architecture.
New formats and areas of inter-BRICS cooperation have also been established during the Ufa summit.
However it should be pointed out that these formats are mostly for discussing issues rather than implementing solutions.
This might be a necessary step on the way for actual cooperation, but the issue of accountability in BRICS remain.
The widely published opinions in Western media that BRICS is declining and has no future are hence far from reality.
However the speed of moving to a more solid institutional and cooperative mechanism is slower than some of the members (namely Russia) would desire.
The cooperative spirit and equality as governing principles of BRICS, though, are a solid basis for a cautious but steady move forward.
A word of caution: the BRICS countries should be aware that the growth of BRICS power could lead to rising resistance from established centers of power.
This would, inevitably, include different methods aimed at undermining BRICS unity.
<<<
>>> The First SDR Review
July 24, 2015 ?
By JC Collins
http://philosophyofmetrics.com/the-first-sdr-review/
The press release from the International Monetary Fund on June 23, 2015, covered some interesting and relevant topics which we have been discussing here. The trend in regards to monetary reform and the multilateral transition is now beginning to align with the macroeconomic policies which are unfolding internationally.
Whether its debt relief in Greece, revaluating exchange rates, loosening of capital controls in China, and the composition review of the Special Drawing Right, the signs and markers are undeniable.
Gerry Rice, Director of Communication for the IMF, during the press briefing, made it clear that along with ESM (European Stability Mechanism) management of the Greece debt and banking crisis (which was first covered here back in Feb), there would be further debt restructuring. How this debt restructuring would look, and what others countries would be involved, was not made clear.
However, based on the understanding which we have built up here on POM, we can extrapolate some obvious points.
One, the IMF will be involved in a more substantial debt relief (restructuring) process then what has been previously enacted amongst European nations.
Two, Greece is being used as the enter point for a more expansive debt restructuring program.
Three, we are only at the beginning of this process.
From the briefing:
QUESTIONER: That being said, the European Summit document makes it clear that an ESM request is conditional on IMF participation. How do you reconcile that with the fact that in pretty stark terms you’ve laid out that the proposals as currently constituted are just not sustainable from a debt perspective?
RICE:Again, what we’ve said is that our participation would be contingent on this balanced approach and that would require on the one hand, reforms, commitment, implementation, and on the other hand, financing and we have said pretty clearly, as you say, we feel the debt relief is required. So, again, the modalities and the process of potential IMF involvement would depend on those things.
In previous posts I have explained how certain currencies will appreciate and how some will depreciate. The logic used was based on the balance of payments deficiencies.
Domestic currencies of countries which have a trade surplus will experience appreciation in order to make exported goods more expensive, which will help decrease the trade surplus by slowing those exports.
Domestic currencies of a countries with trade deficits will experience depreciation in order to make exported goods cheaper, which will help decrease the deficit by increasing exports.
With that logic in mind, we see the following exchange during the IMF press briefing:
QUESTIONER: The Fund a year ago said that the German exchange rate on an adjusted basis was probably 5-15 percent undervalued with the euro. What is the latest Fund view on imbalances within the euro zone and particularly on the German surplus?
RICE:I’m going to ask you to be patient on that one because it’s precisely those kinds of issues that we’re going to be dealing with next Tuesday in the context of this external sector report, and those issues will be updated there and I’m going to point to that in terms of where you might get a more accurate up to date assessment just in a few days’ time.
This references exactly what was explained above in regards to the balance of payments deficiencies. The German currency is undervalued, which correlates with Germany having a large trade surplus. This process of adjusting exchange rates and adjusting balance of payments between nations will not just take place in the Euro zone, but also internationally.
Especially between the largest trade surplus country and the largest trade deficit country, being China and the United States.
The next question which is put forth to Mr. Rice involves the SDR review which is taking place.
QUESTIONER: What can you tell us about the SDR analysis and the release of the report and particularly how that relates to the Chinese Yuan?
RICE:The SDR process, that’s shorthand for the Chinese request from the government of China, that the Chinese currency the renminbi would be included in our SDR basket of currencies. So what I can tell you, Barry, the SDR review is going along well. It’s focused on, as we’ve discussed here before, a well defined set of criteria. What else can I say? The financial market reforms in China are advancing and the renminbi internationalization is continuing. Further progress including continued development of the capital markets to increase the share of equity in bond financing will help improve the efficiency of financial intermediation.
I can tell you there will be an informal board discussion of this toward the end of this month, July, and I’ve laid out the broad timeline here before, I think you probably know what it is, that we’re expecting the formal board discussion of this issue toward the end of this year probably in November, but toward the end of the year. So, as I said, it’s progressing well. We are interacting with the Chinese authorities on this issue on an ongoing basis. There is a lot of work still to be done in terms of gathering data and before we would be in a position to make that assessment. But the timeline is pretty clear and I think the direction of travel is pretty clear.
The timeline is pretty clear and I think the direction of travel is pretty clear. This simple statement confirms the intent and motive to include the RMB in the SDR by years end. The mention of the board meeting on the SDR review “toward the end of this month, July”, leaves 7 days for that review and discussion to take place.
We will eagerly await the press release from that board meeting and first SDR review. As Mr. Rise stated, the “direction of travel is pretty clear”.
With the expansion of RMB liquidity (the first BRICS Bank loan is denominated in RMB), and a reduction in USD liquidity (loans not denominated in USD), the required corrections to the balance of payments and progress. As explained in previous posts, the real solution to balance of payments challenges will be found in the implementation of a super-sovereign unit of account, such as the SDR.
The stage is being set for this transition to take place over the next 1 to 5 years. Here on POM I will continue to provide analytical conclusions based on the fundamentals of this emerging macroeconomic reality. With each passing month the accuracy of the thesis and analysis presented here will be confirmed. – JC
<<<
I like the idea of this topic as a forum...
BRICS
Maybe we can generate some interest.
Have you seen the BRICS POST news website ?
Interesting site.
http://thebricspost.com/
>>> There are now two reserve currencies as petro-yuan joins petro-dollar
Examiner.com
June 9, 2015
http://www.examiner.com/article/there-are-now-two-reserve-currencies-as-petro-yuan-joins-petro-dollar
Ever since Henry Kissinger forged the global petro-dollar agreement with Saudi Arabia and OPEC in 1973, the U.S. currency has remained the singular global reserve for over 40 years. However, on June 9 that sole monetary reign has come to an end as Russian gas giant Gazprom is now officially selling all oil in Chinese Yuan, making the petro-Yuan a joint global reserve, and ending America's sole control over the world's reserve currency.
Less than two years ago, Russia and China forged an agreement where they would construct a platform to allow sales of oil and natural gas to be done in both Roubles and Yuan. However, in its early stages this was limited to transactions between both countries and a small number of trade partners. But with today's confirmation of a fully functional petro-yuan system being implemented by Russia, the world no longer needs to accrue dollar reserves to purchase energy, and the beginning of the end of the petro-dollar is now underway.
“
Russia’s third-largest oil producer, is now settling all of its crude sales to China in renminbi, in the most clear sign yet that western sanctions have driven an increase in the use of the Chinese currency by Russian companies.
Russian executives have talked up the possibility of a shift from the US dollar to renminbi as the Kremlin launched a “pivot to Asia” foreign policy partly in response to the western sanctions against Moscow over its intervention in Ukraine, but until now there has been little clarity over how much trade is being settled in the Chinese currency.
Gazprom Neft, the oil arm of state gas giant Gazprom, said on Friday that since the start of 2015 it had been selling in renminbi all of its oil for export down the East Siberia Pacific Ocean pipeline to China. - Zerohedge
In addition to oil sales, a new report has also verified that Russia is on course to settle nearly all of their trade in the Renminbi, creating a scenario where other countries can soon de-dollarize and no longer require American currency to purchase energy, or engage in bi-lateral trade.
As OPEC continues to use production quotas as a means to attack Russia and other energy producers, the Eurasian power is fighting back by using the petro-yuan as a lever to take away customers from Saudi Arabia, and to block potential ramifications from continued U.S. sanctions. And with China already prepared for an eventual floating of the RMB as it constructs its Belt and Road (Silk Road) initiative, the final battle over control of the next global reserve currency is now front and center, and the singular reign of the petro-dollar is now at an end.
<<<
>>> Is OPEC close to using Petro-Yuan as Russia commences talks with Saudi Arabia? <<<
Yikes, this is big news folks, the beginning of the end for the petro-dollar system, which has maintained global demand for US dollars since the collapse of Bretton Woods in the early 1970s. Without the petro-dollar relationship with Saudi Arabia, the dollar is finished as the world's reserve currency -
>>> Is OPEC close to using Petro-Yuan as Russia commences talks with Saudi Arabia?
Examiner.com
June 18, 2015
http://www.examiner.com/article/is-opec-close-to-using-petro-yuan-as-russia-commences-talks-with-saudi-arabia
Within the past 10 days, Russia and China have concluded two historic energy agreements in which both oil and natural gas will now be sold using the Yuan currency. And with Russia beginning oil talks with Saudi Arabia on June 18 during the economic forum currently being held in St. Petersburg, the next step towards lessening the use of the dollar in global energy purchases could very well be underway.
Nine days ago, Russia and China reached a historic milestone as the Petro-Yuan entered into the global economy through a new program instituted by Gazprom Neft, where the third largest oil company in Russia began selling its production solely in RMB, and provided the rest of the global community the chance to purchase oil in a currency other than the U.S. dollar. Yet the significance of this agreement is only half the story as China released new data three days later that showed their reliance upon Saudi oil was waning at the same time their imports from Russia were increasing.
And it appears now that this trend could be what is bringing Saudi Arabia to Russia, since production cuts to raise prices are off the table, and not part of the primary discussions.
“
The oil ministers of Russia and Saudi Arabia plan to discuss a broad cooperation agreement on Thursday at an economic forum in St Petersburg, two sources told Reuters.
Saudi Arabia is the top producer in the Organization of the Petroleum Exporting Countries and the world's top oil exporter, while Russia, which is not an OPEC member, is the second biggest oil supplier to the global markets.
One source said the agreement to be discussed between Russian Energy Minister Alexander Novak and Saudi Oil Minister Ali al-Naimi would not be about joint oil production or export strategy.
Russia has stepped up contacts with OPEC after oil prices plunged last year, but it has dismissed any suggestion it might cut output to prop up prices. OPEC has also refused to curb its output in order to defend market share. - Moscow Times
China is the world's largest economy, and one of the most important energy consumers for both Russia and Saudi Arabia. And despite the Kingdom's attempts to drive out oil producers in country's such as Iran, Sudan, Russia, and even U.S. shale interests through their increasing of supply, the geo-political moves currently being played are centered more on the petro-dollar than on price or competition.
It may take until the end of this week's economic forum in St. Petersburg to determine the full extent of Russia's talks with Saudi Arabia, but at stake appears to be the future of dollar hegemony over oil. And as pipelines continue to be built that bypass the Middle Eastern Kingdom, and bring both oil and natural gas to Europe through alternative routes such as Turkey and the North Sea, cooperation rather than competition is a vital key to creating energy policies that will benefit both producers in the future.
<<<
>>> China announces they will be setting new gold price by end of year
June 25, 2015
Examiner.com
http://www.examiner.com/article/china-announces-they-will-be-setting-new-gold-price-by-end-of-year
On June 25, a representative from the Shanghai Gold Exchange announced that they are planning on establishing a new physical gold price mechanism by the end of the year that will compete with London and the U.S. Comex. Expected to be denominated in Yuan, this new gold price platform comes less than 10 days after China became the first Asian country invited to be a part of the London gold fix, and unlike the U.S. Comex, will deal in direct physical gold sales rather than in paper futures and derivative contracts.
When the Shanghai Gold Exchange (SGE) opened in 2014, it set out to usurp the West's control over gold and their pricing of gold through the paper markets. And in less than a year, the SGE has created the world's largest gold fund, and is now ready to take over pricing and price discovery for the monetary metal. In fact, sources claim that right now premiums on large sales of gold bullion are ranging as high as $600 over the current paper spot price.
“
A yuan-denominated gold fix will be launched by year-end via the Shanghai Gold Exchange to give the world's biggest producer and leading consumer of bullion more influence over pricing.
The first public confirmation made by an exchange official comes after Reuters cited sources in February on the proposal for the fix to be set through trading on the SGE, the world's biggest physical bullion exchange.
"We will be introducing a yuan-denominated fix at the right moment. We hope to introduce (it) by the end of the year," SGE Vice-President Shen Gang said at the LBMA Bullion Market Forum in Shanghai on Thursday.
"We have policy support for development (of the gold market)," she added. - China Daily
The most interesting thing that will occur from this gold pricing policy is how London and the Comex will deal with the metal should China suddenly set the price far above the current paper spot. If the West still has alot of physical gold in their reserves, they can make a large amount of money arbitraging their buy price with China's sell price. However, it appears for the most part that the amount of gold remaining in London and Comex vaults is limited, and they will be unable to stop the Far Eastern market from determining the physical price should they decide to raise it to much higher levels.
The gold markets in the West have been drained for some time, and are now simply derivatives markets that are protected by London's ability to price gold much lower than supply and demand dictates. And since the Comex has not actually delivered any metals for more than two years despite them being a futures delivery market, the potential that China's move to take over physical gold pricing within the next six months could very easily cause a derivatives meltdown, and drive the price of gold even higher than the SGE might set it at.
<<<
>>> France and Germany join UK in Asia bank membership
BBC News
17 March 2015
http://www.bbc.com/news/business-31921011
Chinese President Xi Jinping (C) poses at a meeting of representatives at the signing ceremony for the Asian Infrastructure Investment Bank at the Great Hall of the People on October 24, 2014 in Beijing, China.
The Asian Infrastructure Investment Bank agreement was signed in October by 21 countries, including China
France and Germany are to join the UK in becoming members of a Chinese-led Asian development bank.
The finance ministries of both countries confirmed on Tuesday that they would be applying for membership of the Asian Infrastructure Investment Bank (AIIB).
Last week, the US issued a rare rebuke to the UK over its decision to become a member of the AIIB.
The US considers the AIIB a rival to the Western-dominated World Bank.
The UK was the first Western economy to apply for membership of the bank.
But German finance minister Wolfgang Schaeuble confirmed on Tuesday that his country would also be applying for membership.
France's finance ministry confirmed it would be joining the bank. It is believed Italy also intends to join.
The US has questioned the governance standards at the new institution, which is seen as spreading Chinese "soft power".
The AIIB, which was created in October by 21 countries, led by China, will fund Asian energy, transport and infrastructure projects.
When asked about the US rebuke last week, a spokesman for Prime Minister David Cameron said: "There will be times when we take a different approach."
The UK insisted it would insist on the bank's adherence to strict banking and oversight procedures.
"We think that it's in the UK's national interest," Mr Cameron's spokesperson added.
'Not normal'
Last week, Pippa Malmgren, a former economic adviser to US President George W Bush, told the BBC that the public chastisement from the US indicates the move might have come as a surprise.
"It's not normal for the United States to be publicly scolding the British," she said, adding that the US's focus on domestic affairs at the moment could have led to the oversight.
However, Mr Cameron's spokesperson said UK Chancellor George Osborne did discuss the measure with his US counterpart before announcing the move.
Some 21 nations came together last year to sign a memorandum for the bank's establishment, including Singapore, India and Thailand.
But in November last year, Australia's Prime Minister Tony Abbott offered lukewarm support to the AIIB and said its actions must be transparent.
US President Barack Obama, who met Mr Abbott on the sidelines of a Beijing summit last year, agreed the bank had to be transparent, accountable and truly multilateral.
"Those are the same rules by which the World Bank or IMF [International Monetary Fund] or Asian Development Bank or any other international institution needs to abide by," Mr Obama said at the time.
<<<
Perfide Albion -->>> UK support for China-backed Asia bank prompts US concern
BBC News
13 March 2015
http://www.bbc.com/news/world-australia-31864877
Chinese President Xi Jinping (C) poses at a meeting of representatives at the signing ceremony for the Asian Infrastructure Investment Bank at the Great Hall of the People on October 24, 2014 in Beijing, China.
The Asian Infrastructure Investment Bank agreement was signed in October by 21 countries, including China
The US has expressed concern over the UK's bid to become a founding member of a Chinese-backed development bank.
The UK is the first big Western economy to apply for membership of the Asian Infrastructure Investment Bank (AIIB).
The US has raised questions over the bank's commitment to international standards on governance.
"There will be times when we take a different approach," a spokesperson for Prime Minister David Cameron said about the rare rebuke from the US.
The AIIB, which was created in October by 21 countries, led by China, will fund Asian energy, transport and infrastructure projects.
The UK insisted it would demand the bank adhere to strict banking and oversight procedures.
"We think that it's in the UK's national interest," said Mr Cameron's spokesperson.
'Not normal'
Pippa Malmgren, a former economic advisor to US President George W Bush, told the BBC that the public chastisement from the US indicates the move might have come as a surprise.
"It's not normal for the United States to be publicly scolding the British," she said, adding that the US's focus on domestic affairs at the moment could have led to the oversight.
However, Mr Cameron's spokesperon said UK Chancellor George Osborne did discuss the measure with his US counterpart before announcing the move.
In a statement announcing the UK's intention to join the bank, Mr Osborne said that joining the AIIB at the founding stage would create "an unrivalled opportunity for the UK and Asia to invest and grow together".
The hope is that investment in the bank will give British companies an opportunity to invest in the world's fastest growing markets.
But the US sees the Chinese effort as a ploy to dilute US control of the banking system, and has persuaded regional allies such as Australia, South Korea and Japan to stay out of the bank.
In response to the move, US National Security Council spokesman Patrick Ventrell said: "We believe any new multilateral institution should incorporate the high standards of the World Bank and the regional development banks."
"Based on many discussions, we have concerns about whether the AIIB will meet these high standards, particularly related to governance, and environmental and social safeguards," he added.
Analysis: Linda Yueh, BBC chief business correspondent
It's a tricky task to align oneself with both China and the US. The Americans are apparently unhappy with the UK, while China has welcomed the British application.
It may be a pragmatic move, but it's hard not to offend one side or another.
I suspect this will be the first of many decisions to be taken by countries such as the UK to position themselves between the new economic superpower and the existing one.
The trick will be to come away with economic advantage at minimal political cost. We'll find out if this one will pay off for the UK.
Why does the UK want to join a China-led bank?
'No consultation'
Some 21 nations came together last year to sign a memorandum for the bank's establishment, including Singapore, India and Thailand.
But in November last year, Australia's Prime Minister Tony Abbott offered lukewarm support to the AIIB and said its actions must be transparent.
US President Barack Obama, who met Mr Abbott on the sidelines of a Beijing summit last year, agreed the bank had to be transparent, accountable and truly multilateral.
"Those are the same rules by which the World Bank or IMF (International Monetary Fund) or Asian Development Bank or any other international institution needs to abide by," Mr Obama said at the time.
The Financial Times (FT) newspaper reported on Thursday that US officials had complained about the British move.
The report cited an unnamed senior US administration official as saying the British decision was taken after "virtually no consultation with the US".
"We are wary about a trend toward constant accommodation of China," the newspaper quoted the US official as saying.
However, in response to the UK announcement, World Bank president Jim Yong Kim told a news conference he supported the goals of the AIIB.
"From the perspective simply of the need for more infrastructure spending, there's no doubt that from our perspective, we welcome the entry of the Asian Infrastructure Investment Bank," he said.
Offence
The founding member countries of the AIIB have agreed the basic parameters that would determine the capital structure of the new bank would be relative gross domestic product.
Banking experts have estimated that, if taken at face value, this would give China a 67% shareholding in the new bank.
That's significantly different than the Asia Development Bank, which has a similar structure to the World Bank and has been in existence 1966. There, the majority stakes are controlled by Japan and the US.
Speaking in Beijing last year, Mr Abbott said Australia would only sign up to "a genuinely multilateral body"
When asked if Britain would seek assurances before it signed on as a member that no one country would be able to unilaterally control the AIIB, economist David Kuo told the BBC that the UK "wouldn't have a great deal of say in the matter".
"He who pays the piper calls the tune," he said. "The UK could try and negotiate a power to veto projects but it is unlikely to get it," Mr Kuo, who is from investment advisers The Motley Fool, said.
The UK was caught between the US on the West and China in the East, he added.
"It hopes that it can exert force from within, rather than put pressure from the outside - but [the UK] is only one voice in a crowd of many."
With regard to the competition the AIIB would give the ADB or World Bank, Mr Kuo said there were plenty of infrastructure projects in Asia that needed funding.
"The existing sources of money can't do everything. So every little helps."
<<<
Silk Road Economic Belt, Maritime Silk Road -
>>> One Belt, One Road
https://en.wikipedia.org/wiki/One_Belt,_One_Road
From Wikipedia, the free encyclopedia
(Redirected from Belt and Road)
Jump to: navigation, search
One Belt, One Road (Chinese: ????; pinyin: Yídài yílù, also known as the Belt and Road Initiative; abbreviated OBOR) is a development strategy and framework, proposed by People's Republic of China that focuses on connectivity and cooperation among countries primarily in Eurasia, which consists of two main components, the land-based "Silk Road Economic Belt" (SREB) and oceangoing "Maritime Silk Road" (MSR). The strategy underlines China's push to take a bigger role in global affairs, and its need to export China's production capacity in areas of overproduction such as steel manufacturing.[1]
It was unveiled by Chinese leader Xi Jinping in September and October 2013 in announcements revealing the SREB and MSR, respectively.
Contents [hide]
1 Infrastructure networks 1.1 Silk Road Economic Belt
1.2 Maritime Silk Road 1.2.1 East Africa
1.3 Closely related networks
2 Financial institutions 2.1 AIIB
2.2 Silk Road Fund
3 Oversight
4 References
Infrastructure networks[edit]
The coverage area of the initiative is primarily Asia and Europe. However, Oceania is also included as well as East Africa.
Silk Road Economic Belt[edit]
The Silk Road Economic Belt (???????) initiative was announced by President Xi Jinping on a visit to Kazakhstan. Essentially, the 'belt' includes countries situated on the original Silk Road through Central Asia, West Asia, the Middle East, and Europe. The initiative calls for the integration of the region into a cohesive economic area through building infrastructure, increasing cultural exchanges, and broadening trade. Apart from this zone, which is largely analogous to the historical Silk Road, another area that is said to be included in the extension of this 'belt' is South Asia and Southeast Asia. Many of the countries that are part of this 'belt' are also members of the China-led Asian Infrastructure Investment Bank (AIIB).
Maritime Silk Road[edit]
The Maritime Silk Road, also known as the "21st Century Maritime Silk Route Economic Belt" (21????????) is a complementary initiative aimed at investing and fostering collaboration in Southeast Asia, Oceania, and North Africa, through several contiguous bodies of water – the South China Sea, the South Pacific Ocean, and the wider Indian Ocean area.[2][3][4]
The Maritime Silk Road initiative was first proposed by Xi Jinping during a speech to the Indonesian Parliament in October 2013.[5] Like its sister initiative the Silk Road Economic Belt, most countries in this area have joined the China-led Asian Infrastructure Investment Bank.
East Africa[edit]
This region of Africa (In particular Kenya) will form part of the MSR after improvement of local ports and construction of a modern standard-gauge rail link between Nairobi and Mombasa.[6]
Closely related networks[edit]
The China-Pakistan Economic Corridor(CPEC) and the Bangladesh-China-India-Myanmar(BCIM) Economic Corridor are officially classified as "closely related to the Belt and Road Initiative".[7] In coverage by the media, this distinction is disregarded and the networks are counted as components of the initiative.
Financial institutions[edit]
This section does not cite any references or sources. Please help improve this section by adding citations to reliable sources. Unsourced material may be challenged and removed. (June 2015)
AIIB[edit]
The Asian Infrastructure Investment Bank founded by China in 2014 with the participation of 56 other countries is a development bank dedicated to lending for projects that are part of the initiative.
Silk Road Fund[edit]
In November 2014, Xi Jinping announced plans to create a 40 billion USD development fund, which will be distinguished from the banks created for the initiative. As a fund its role will be to invest in businesses rather than lend money for projects.
Oversight[edit]
This section does not cite any references or sources. Please help improve this section by adding citations to reliable sources. Unsourced material may be challenged and removed. (June 2015)
The Leading Group for Advancing the Development of One Belt One Road was formed sometime in late 2014, and its leadership line-up publicized on February 1, 2015. This steering committee reports directly into the State Council of the People's Republic of China and is composed of several political heavyweights, evidence of the importance of the program to the government. Vice-Premier Zhang Gaoli, who is also a member of the 7-man Politburo Standing Committee, was named leader of the group, with Wang Huning, Wang Yang, Yang Jing, and Yang Jiechi being named deputy leaders.
In March 2014, Chinese Premier Li Keqiang called for accelerating the "One Belt One Road" initiative along with the Bangladesh-China-India-Myanmar Economic Corridor and the China-Pakistan Economic Corridor in his government work report presented to the annual meeting of the country's legislature.
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>>> BRICS Bank Launches, Boosting China’s Influence
Saibal Dasgupta
July 21, 2015
http://www.voanews.com/content/brics-bank-launches-boosting-china-influence/2871693.html
BEIJING—
A new $100 billion international development bank backed by developing countries launched in Shanghai Tuesday, in what official Chinese media called a challenge to Western-backed international lenders.
The New Development Bank came after three years of negotiations among members of BRICS — Brazil, Russia, India, China and South Africa. The launch comes soon after the formation of another multilateral bank, the Asian Infrastructure Investment Bank, which was organized by Beijing.
"Obviously, the new institutions are going to break the monopoly of the World Bank. Now, there will be more options for borrowers, who will look for the best terms among different institutions," Bala Ramasamy, professor of economics at the China Europe International Business School in Shanghai said.
China is expected to dominate both institutions. It has the biggest share at 31 percent in the AIIB. In the NDB, it is contributing equally with the four other countries in the $50 billion initial capital, which will be doubled later on. But China has taken a 41 percent share in a $100 billion contingency fund, which was announced by NDB on Tuesday.
China as global banker
"It seems China is going to play an increasingly bigger role through the new institutions," Ramaswamy said. "Developed countries like the United States and the United Kingdom will be forced to increase their roles, and review their relationship with the developing world."
Some analysts say that the new banks are relatively small compared to the World Bank, and challenging it at a serious level will be difficult. Critics of the new banking institutions also have questioned whether the projects they finance will have provisions protecting human rights and enforcing environmental safeguards.
The NDB may not be able to compete with the World Bank in terms of low interest rates because of its higher cost of borrowings. Any future bonds by the NDB will be judged on the basis of the credit ratings of its member countries.
"The NDB and the AIIB may want to break the monopoly of World Bank and the International Monetary Fund. That is their ambition. But do they have the confidence to do so at this stage? I have to say ‘no,’" said Liu Xiaoxue, a researcher at the Beijing-based National Institute of International Strategy.
Competitors or collaborators?
M.V. Kamath, the first president of NDB, an Indian banker, addressed the bank’s relations with the World Bank, the International Monetary Fund and other major lenders at the inauguration ceremony on Tuesday.
"Our objective is not to challenge the existing system as it is but to improve and complement the system in our own way," he said.
He also indicated NDB will coordinate policies with the AIIB by establishing a "hotline" to improve communications.
The new institutions might also need help from the World Bank and established institutions like the Asian Development Bank for project assessment expertise and joint financing. The AIIB and the World Bank are already discussing joint financing of specific projects, and this might be extended to the NDB.
“Some parts we learn from the World Bank, some parts we try to do things differently,” Zhu Xian, vice president of NDB, told China Central Television on Tuesday. “We will complement with each other with the World Bank and other international development banks. But in some projects, there will be competition.”
Funding Chinese projects
Chinese finance minister Lou Jiwei made it clear the NDB and the AIIB will work together.
"It [NDB]will also complement the China-initiated Asian Infrastructure Investment Bank, and both will share operational experience and strengthen cooperation when the projects start.”
China's goal is to get the new bank to finance its "One Belt, One Road" program that involves constructing a chain of infrastructure projects across the world. Beijing sees it as a means to revive its own economy by obtaining contracts for Chinese construction companies and machinery suppliers.
"The bank will provide new driving force to accelerate the global economic recovery by supporting infrastructure projects and expanding global demand," Lou said.
Critics say the World Bank takes an overly rule-bound approach to project assessment, and often rejects proposals that its experts consider to be environmentally unsustainable. The new banks are expected to take a different approach.
"I would say the NDB will conduct proper environment impact assessment. But it is going to try and reduce the negative environment impact of projects from developing countries instead of entirely rejecting them," Ramaswamy said.
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>>> The Eurasian Big Bang: How China & Russia Are Running Rings Around Washington
Submitted by Tyler Durden
07/24/2015
by Pepe Escobar
http://www.zerohedge.com/news/2015-07-24/eurasian-big-bang-how-china-russia-are-running-rings-around-washington
Let’s start with the geopolitical Big Bang you know nothing about, the one that occurred just two weeks ago. Here are its results: from now on, any possible future attack on Iran threatened by the Pentagon (in conjunction with NATO) would essentially be an assault on the planning of an interlocking set of organizations -- the BRICS nations (Brazil, Russia, India, China, and South Africa), the SCO (Shanghai Cooperation Organization), the EEU (Eurasian Economic Union), the AIIB (the new Chinese-founded Asian Infrastructure Investment Bank), and the NDB (the BRICS' New Development Bank) -- whose acronyms you’re unlikely to recognize either. Still, they represent an emerging new order in Eurasia.
Tehran, Beijing, Moscow, Islamabad, and New Delhi have been actively establishing interlocking security guarantees. They have been simultaneously calling the Atlanticist bluff when it comes to the endless drumbeat of attention given to the flimsy meme of Iran’s "nuclear weapons program." And a few days before the Vienna nuclear negotiations finally culminated in an agreement, all of this came together at a twin BRICS/SCO summit in Ufa, Russia -- a place you’ve undoubtedly never heard of and a meeting that got next to no attention in the U.S. And yet sooner or later, these developments will ensure that the War Party in Washington and assorted neocons (as well as neoliberalcons) already breathing hard over the Iran deal will sweat bullets as their narratives about how the world works crumble.
The Eurasian Silk Road
With the Vienna deal, whose interminable build-up I had the dubious pleasure of following closely, Iranian Foreign Minister Javad Zarif and his diplomatic team have pulled the near-impossible out of an extremely crumpled magician’s hat: an agreement that might actually end sanctions against their country from an asymmetric, largely manufactured conflict.
Think of that meeting in Ufa, the capital of Russia’s Bashkortostan, as a preamble to the long-delayed agreement in Vienna. It caught the new dynamics of the Eurasian continent and signaled the future geopolitical Big Bangness of it all. At Ufa, from July 8th to 10th, the 7th BRICS summit and the 15th Shanghai Cooperation Organization summit overlapped just as a possible Vienna deal was devouring one deadline after another.
Consider it a diplomatic masterstroke of Vladmir Putin’s Russia to have merged those two summits with an informal meeting of the Eurasian Economic Union (EEU). Call it a soft power declaration of war against Washington’s imperial logic, one that would highlight the breadth and depth of an evolving Sino-Russian strategic partnership. Putting all those heads of state attending each of the meetings under one roof, Moscow offered a vision of an emerging, coordinated geopolitical structure anchored in Eurasian integration. Thus, the importance of Iran: no matter what happens post-Vienna, Iran will be a vital hub/node/crossroads in Eurasia for this new structure.
If you read the declaration that came out of the BRICS summit, one detail should strike you: the austerity-ridden European Union (EU) is barely mentioned. And that’s not an oversight. From the point of view of the leaders of key BRICS nations, they are offering a new approach to Eurasia, the very opposite of the language of sanctions.
Here are just a few examples of the dizzying activity that took place at Ufa, all of it ignored by the American mainstream media. In their meetings, President Putin, China's President Xi Jinping, and Indian Prime Minister Narendra Modi worked in a practical way to advance what is essentially a Chinese vision of a future Eurasia knit together by a series of interlocking “new Silk Roads.” Modi approved more Chinese investment in his country, while Xi and Modi together pledged to work to solve the joint border issues that have dogged their countries and, in at least one case, led to war.
The NDB, the BRICS’ response to the World Bank, was officially launched with $50 billion in start-up capital. Focused on funding major infrastructure projects in the BRICS nations, it is capable of accumulating as much as $400 billion in capital, according to its president, Kundapur Vaman Kamath. Later, it plans to focus on funding such ventures in other developing nations across the Global South -- all in their own currencies, which means bypassing the U.S. dollar. Given its membership, the NDB’s money will clearly be closely linked to the new Silk Roads. As Brazilian Development Bank President Luciano Coutinho stressed, in the near future it may also assist European non-EU member states like Serbia and Macedonia. Think of this as the NDB’s attempt to break a Brussels monopoly on Greater Europe. Kamath even advanced the possibility of someday aiding in the reconstruction of Syria.
You won’t be surprised to learn that both the new Asian Infrastructure Investment Bank and the NDB are headquartered in China and will work to complement each other’s efforts. At the same time, Russia’s foreign investment arm, the Direct Investment Fund (RDIF), signed a memorandum of understanding with funds from other BRICS countries and so launched an informal investment consortium in which China’s Silk Road Fund and India’s Infrastructure Development Finance Company will be key partners.
Full Spectrum Transportation Dominance
On the ground level, this should be thought of as part of the New Great Game in Eurasia. Its flip side is the Trans-Pacific Partnership in the Pacific and the Atlantic version of the same, the Transatlantic Trade and Investment Partnership, both of which Washington is trying to advance to maintain U.S. global economic dominance. The question these conflicting plans raise is how to integrate trade and commerce across that vast region. From the Chinese and Russian perspectives, Eurasia is to be integrated via a complex network of superhighways, high-speed rail lines, ports, airports, pipelines, and fiber optic cables. By land, sea, and air, the resulting New Silk Roads are meant to create an economic version of the Pentagon’s doctrine of “Full Spectrum Dominance” -- a vision that already has Chinese corporate executives crisscrossing Eurasia sealing infrastructure deals.
For Beijing -- back to a 7% growth rate in the second quarter of 2015 despite a recent near-panic on the country’s stock markets -- it makes perfect economic sense: as labor costs rise, production will be relocated from the country’s Eastern seaboard to its cheaper Western reaches, while the natural outlets for the production of just about everything will be those parallel and interlocking “belts” of the new Silk Roads.
Meanwhile, Russia is pushing to modernize and diversify its energy-exploitation-dependent economy. Among other things, its leaders hope that the mix of those developing Silk Roads and the tying together of the Eurasian Economic Union -- Russia, Armenia, Belarus, Kazakhstan, and Kyrgyzstan -- will translate into myriad transportation and construction projects for which the country’s industrial and engineering know-how will prove crucial.
As the EEU has begun establishing free trade zones with India, Iran, Vietnam, Egypt, and Latin America’s Mercosur bloc (Argentina, Brazil, Paraguay, Uruguay, and Venezuela), the initial stages of this integration process already reach beyond Eurasia. Meanwhile, the SCO, which began as little more than a security forum, is expanding and moving into the field of economic cooperation. Its countries, especially four Central Asian “stans” (Kazakhstan, Kyrgyzstan, Uzbekistan, and Tajikistan) will rely ever more on the Chinese-driven Asia Infrastructure Investment Bank (AIIB) and the NDB. At Ufa, India and Pakistan finalized an upgrading process in which they have moved from observers to members of the SCO. This makes it an alternative G8.
In the meantime, when it comes to embattled Afghanistan, the BRICS nations and the SCO have now called upon “the armed opposition to disarm, accept the Constitution of Afghanistan, and cut ties with Al-Qaeda, ISIS, and other terrorist organizations.” Translation: within the framework of Afghan national unity, the organization would accept the Taliban as part of a future government. Their hopes, with the integration of the region in mind, would be for a future stable Afghanistan able to absorb more Chinese, Russian, Indian, and Iranian investment, and the construction -- finally! -- of a long-planned, $10 billion, 1,420-kilometer-long Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline that would benefit those energy-hungry new SCO members, Pakistan and India. (They would each receive 42% of the gas, the remaining 16% going to Afghanistan.)
Central Asia is, at the moment, geographic ground zero for the convergence of the economic urges of China, Russia, and India. It was no happenstance that, on his way to Ufa, Prime Minister Modi stopped off in Central Asia. Like the Chinese leadership in Beijing, Moscow looks forward (as a recent document puts it) to the “interpenetration and integration of the EEU and the Silk Road Economic Belt” into a “Greater Eurasia” and a “steady, developing, safe common neighborhood” for both Russia and China.
And don’t forget Iran. In early 2016, once economic sanctions are fully lifted, it is expected to join the SCO, turning it into a G9. As its foreign minister, Javad Zarif, made clear recently to Russia's Channel 1 television, Tehran considers the two countries strategic partners. "Russia,” he said, “has been the most important participant in Iran's nuclear program and it will continue under the current agreement to be Iran's major nuclear partner." The same will, he added, be true when it comes to “oil and gas cooperation,” given the shared interest of those two energy-rich nations in “maintaining stability in global market prices."
Got Corridor, Will Travel
Across Eurasia, BRICS nations are moving on integration projects. A developing Bangladesh-China-India-Myanmar economic corridor is a typical example. It is now being reconfigured as a multilane highway between India and China. Meanwhile, Iran and Russia are developing a transportation corridor from the Persian Gulf and the Gulf of Oman to the Caspian Sea and the Volga River. Azerbaijan will be connected to the Caspian part of this corridor, while India is planning to use Iran’s southern ports to improve its access to Russia and Central Asia. Now, add in a maritime corridor that will stretch from the Indian city of Mumbai to the Iranian port of Bandar Abbas and then on to the southern Russian city of Astrakhan. And this just scratches the surface of the planning underway.
Years ago, Vladimir Putin suggested that there could be a “Greater Europe” stretching from Lisbon, Portugal, on the Atlantic to the Russian city of Vladivostok on the Pacific. The EU, under Washington’s thumb, ignored him. Then the Chinese started dreaming about and planning new Silk Roads that would, in reverse Marco Polo fashion, extend from Shanghai to Venice (and then on to Berlin).
Thanks to a set of cross-pollinating political institutions, investment funds, development banks, financial systems, and infrastructure projects that, to date, remain largely under Washington’s radar, a free-trade Eurasian heartland is being born. It will someday link China and Russia to Europe, Southwest Asia, and even Africa. It promises to be an astounding development. Keep your eyes, if you can, on the accumulating facts on the ground, even if they are rarely covered in the American media. They represent the New Great -- emphasis on that word -- Game in Eurasia.
Location, Location, Location
Tehran is now deeply invested in strengthening its connections to this new Eurasia and the man to watch on this score is Ali Akbar Velayati. He is the head of Iran's Center for Strategic Research and senior foreign policy adviser to Supreme Leader Ayatollah Khamenei. Velayati stresses that security in Asia, the Middle East, North Africa, Central Asia, and the Caucasus hinges on the further enhancement of a Beijing-Moscow-Tehran triple entente.
As he knows, geo-strategically Iran is all about location, location, location. That country offers the best access to open seas in the region apart from Russia and is the only obvious east-west/north-south crossroads for trade from the Central Asian “stans.” Little wonder then that Iran will soon be an SCO member, even as its “partnership” with Russia is certain to evolve. Its energy resources are already crucial to and considered a matter of national security for China and, in the thinking of that country’s leadership, Iran also fulfills a key role as a hub in those Silk Roads they are planning.
That growing web of literal roads, rail lines, and energy pipelines, as TomDispatch has previously reported, represents Beijing’s response to the Obama administration’s announced “pivot to Asia” and the U.S. Navy’s urge to meddle in the South China Sea. Beijing is choosing to project power via a vast set of infrastructure projects, especially high-speed rail lines that will reach from its eastern seaboard deep into Eurasia. In this fashion, the Chinese-built railway from Urumqi in Xinjiang Province to Almaty in Kazakhstan will undoubtedly someday be extended to Iran and traverse that country on its way to the Persian Gulf.
A New World for Pentagon Planners
At the St. Petersburg International Economic Forum last month, Vladimir Putin told PBS's Charlie Rose that Moscow and Beijing had always wanted a genuine partnership with the United States, but were spurned by Washington. Hats off, then, to the “leadership” of the Obama administration. Somehow, it has managed to bring together two former geopolitical rivals, while solidifying their pan-Eurasian grand strategy.
Even the recent deal with Iran in Vienna is unlikely -- especially given the war hawks in Congress -- to truly end Washington’s 36-year-long Great Wall of Mistrust with Iran. Instead, the odds are that Iran, freed from sanctions, will indeed be absorbed into the Sino-Russian project to integrate Eurasia, which leads us to the spectacle of Washington’s warriors, unable to act effectively, yet screaming like banshees.
NATO's supreme commander Dr. Strangelove, sorry, American General Philip Breedlove, insists that the West must create a rapid-reaction force -- online -- to counteract Russia's "false narratives.” Secretary of Defense Ashton Carter claims to be seriously considering unilaterally redeploying nuclear-capable missiles in Europe. The nominee to head the Joint Chiefs of Staff, Marine Commandant Joseph Dunford, recently directly labeled Russia America’s true “existential threat”; Air Force General Paul Selva, nominated to be the new vice chairman of the Joint Chiefs, seconded that assessment, using the same phrase and putting Russia, China and Iran, in that order, as more threatening than the Islamic State (ISIS). In the meantime, Republican presidential candidates and a bevy of congressional war hawks simply shout and fume when it comes to both the Iranian deal and the Russians.
In response to the Ukrainian situation and the “threat” of a resurgent Russia (behind which stands a resurgent China), a Washington-centric militarization of Europe is proceeding apace. NATO is now reportedly obsessed with what’s being called “strategy rethink” -- as in drawing up detailed futuristic war scenarios on European soil. As economist Michael Hudson has pointed out, even financial politics are becoming militarized and linked to NATO’s new Cold War 2.0.
In its latest National Military Strategy, the Pentagon suggests that the risk of an American war with another nation (as opposed to terror outfits), while low, is “growing” and identifies four nations as “threats”: North Korea, a case apart, and predictably the three nations that form the new Eurasian core: Russia, China, and Iran. They are depicted in the document as “revisionist states,” openly defying what the Pentagon identifies as “international security and stability”; that is, the distinctly un-level playing field created by globalized, exclusionary, turbo-charged casino capitalism and Washington's brand of militarism.
The Pentagon, of course, does not do diplomacy. Seemingly unaware of the Vienna negotiations, it continued to accuse Iran of pursuing nuclear weapons. And that “military option” against Iran is never off the table.
So consider it the Mother of All Blockbusters to watch how the Pentagon and the war hawks in Congress will react to the post-Vienna and -- though it was barely noticed in Washington -- the post-Ufa environment, especially under a new White House tenant in 2017.
It will be a spectacle. Count on it. Will the next version of Washington try to make it up to “lost” Russia or send in the troops? Will it contain China or the “caliphate” of ISIS? Will it work with Iran to fight ISIS or spurn it? Will it truly pivot to Asia for good and ditch the Middle East or vice-versa? Or might it try to contain Russia, China, and Iran simultaneously or find some way to play them against each other?
In the end, whatever Washington may do, it will certainly reflect a fear of the increasing strategic depth Russia and China are developing economically, a reality now becoming visible across Eurasia. At Ufa, Putin told Xi on the record: "Combining efforts, no doubt we [Russia and China] will overcome all the problems before us."
Read “efforts” as new Silk Roads, that Eurasian Economic Union, the growing BRICS block, the expanding Shanghai Cooperation Organization, those China-based banks, and all the rest of what adds up to the beginning of a new integration of significant parts of the Eurasian land mass. As for Washington, fly like an eagle? Try instead: scream like a banshee.
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>>> How do you Stop the BRICS?… Try to “TPP-Toe” Around It…
11-12-14…”Obama’s Setback in Beijing”
Posted on 2014/11/12 by kauilapele
You know, I really haven’t paid much attention to the TPP (Trans-Pacific Partnership) (actually, TPPA; oh, well… just read the article to clarify the acronyms). But I enjoyed reading this Stuart Jeanne Bramhall VT article which indicates that the TPP (TPPA), which excluded ALL BRICS countries, in particular, CHINA (all-caps because it’s a really BIG player in the Pacific region). It appears to me that this was an effort (attempt) by the “cabal”, “corporate interests”, etc., to mess things up, and derail the new trade and monetary arrangements being made among the BRICS and other non-Western-aligned countries.
Looks like the bottom line message about all this is… “Tough noogies, Mr. Obama and USA CORPORATION interests… we’re playing our own game, not yours.”
The only thing I see missing in the Free Trade Area of the Asia-Pacific (FTAAP) treaty, is that this should include another nation: The Kingdom of Hawai’i.
“The US has required the twelve countries participating in TPPA negotiations to sign a secrecy clause. Only corporations (i.e. the 600 corporations that helped write it) are allowed to see the text of the treaty. Not even Congress is permitted access. If Wikileaks hadn’t leaked large sections of the draft agreement, we wouldn’t even know it existed.
“If finalized, the TPPA would also allow oil and gas companies to overturn fracking bans, Monsanto to overturn GMO labeling laws, investment banks to overturn banking regulations and the telecommunications industry to overturn Net Neutrality laws.
“The POTUS also had hopes of ramming through an agreement on the TPPA treaty in Beijing, at a side meeting in the US embassy. It appears he did try and failed, as Pepe Escobar describes in a recent RT article Lame Duck Out of the Silk Trade Caravan.
“In an interview with Chinese media, Obama denies he was trying to isolate China by pressuring Asian Pacific countries to sign a secret trade deal that excludes them. Yet it’s pretty obvious to all concerned that’s exactly what he’s trying to do.
“It’s also pretty clear that Chinese president Xi Jinping outmaneuvered him. In addition to getting all 21 APEC nations to sign onto an FTAAP feasibility study, China signed other trade deals geared towards reducing US dominance in the region”
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Obama’s Setback in Beijing
The Transpacific Partnership Agreement (TPPA) is a secret free trade treaty Obama is negotiating with eleven other Asian Pacific countries (US, New Zealand, Australia, Malaysia, Japan, Chile, Peru, Canada, Mexico, Vietnam, Singapore and Brunei). The President had hoped to seal the deal at the recent Asian Pacific Economic Cooperation (APEC) summit in Beijing. Instead all 21 Pacific Rim countries have agreed to develop a roadmap for a Free Trade Area of the Asia-Pacific (FTAAP) treaty. The FTAAP would include China and Russia, whereas the TPPA excludes them.
China Deliberately Excluded
The TPPA is viewed as a centerpiece of Obama’s “strategic rebalancing” towards Asia. Also known as the “Asian pivot,” Obama’s intention is to counter China’s growing economic strength by isolating them economically and militarily.
The US has required the twelve countries participating in TPPA negotiations to sign a secrecy clause. Only corporations (i.e. the 600 corporations that helped write it) are allowed to see the text of the treaty. Not even Congress is permitted access. If Wikileaks hadn’t leaked large sections of the draft agreement, we wouldn’t even know it existed.
Is TPPA Really a Trade Treaty?
Scheduled to coincide with the APEC summit, November 8 was an International Day of Action against the TPPA, with major protests in New Zealand, Australia, Malaysia and the US. From the sections which have been leaked, it seems the TPPA isn’t a trade treaty at all. It’s really an investor protection treaty, granting corporations the right to sue countries for laws that potentially hurt their ability to make a profit. These lawsuits, involving hundreds of millions of dollars, would be heard by secret tribunals run by corporate lawyers. There would be no right of appeal.
In other words, the intent of the TPPA is to allow corporations to overturn the environmental, labor and healthy and safety laws and regulations of member countries. There’s even a special “transparency” clause inserted by the pharmaceutical industry that would allow them to challenge formularies (in the US this would include Medicaid and the VA) that promote cheaper generic medications.
If finalized, the TPPA would also allow oil and gas companies to overturn fracking bans, Monsanto to overturn GMO labeling laws, investment banks to overturn banking regulations and the telecommunications industry to overturn Net Neutrality laws.
Why the Secrecy?
It’s pretty obvious why Obama is trying to negotiate the TPPA in secret. Prior investor protection treaties (e.g. the Free Trade of the Americas Agreement) have gone down in flames thanks to massive public lashback, both in the US and in treaty partner countries.
Congress isn’t too happy, either, about being denied access to the draft TPPA treaty. In November 2013 Congress voted down Obama’s request for “fast track” authority on the TPPA. Fast track, otherwise known as Trade Promotion Authority, would require Congress to accept the final TPPA deal or reject it. No debate would be allowed on specific provisions.
There are rumors Obama plans to reintroduce TPPA fast track authority before Christmas, hoping for a better outcome with a new, pro-business Republican congress.
The POTUS also had hopes of ramming through an agreement on the TPPA treaty in Beijing, at a side meeting in the US embassy. It appears he did try and failed, as Pepe Escobar describes in a recent RT article Lame Duck Out of the Silk Trade Caravan.
The Effect on Australia and New Zealand
A trade deal that excludes China, their major trading partner, makes absolutely no sense for Australia and New Zealand. Kiwi and Aussie environmental and labor activists are also deeply concerned about signing an international agreement that allows multinational corporations to sue their governments in a secret corporate tribunal. They’ve worked damned hard to win laws and regulations guaranteeing minimal environmental, labor and health safety standards. If the TPPA goes through, these could all be wiped out with the stroke of a pen.
China Aims to Suppress US Influence in Asia
In an interview with Chinese media, Obama denies he was trying to isolate China by pressuring Asian Pacific countries to sign a secret trade deal that excludes them. Yet it’s pretty obvious to all concerned that’s exactly what he’s trying to do.
It’s also pretty clear that Chinese president Xi Jinping outmaneuvered him. In addition to getting all 21 APEC nations to sign onto an FTAAP feasibility study, China signed other trade deals geared towards reducing US dominance in the region.
On Monday the Chinese and Malaysian central banks signed a deal to establish a yuan clearing bank (to facilitate energy and other trade deals in local currencies rather than US dollars).
Russia and China signed a similar deal to conduct oil trades in rubles and yuan, rather than US dollars. According to Russian president Vladimir Putin, the new agreement will significantly reduce US influence over world energy markets.
Back in October,
Back in October, China launched the Asian Infrastructure Investment Bank a rival to the US-dominated World Bank and Asian Development Bank.
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