Markus Zydra and Marcel Grzanna
September 19, 2011
MUNICH -- Back in the fall of 2010, China's prime minister, Wen Jiabao, must surely have enjoyed the state reception he got in Italy, when Rome's Colosseum was flooded in red light and calligraphic messages wishing eternal friendship between the two countries. Italian Prime Minister Silvio Berlusconi spared no expense, paying court to the rich uncle from Beijing. Berlusconi seemed to sense he'd soon be needing something from his guest. That time is now upon us.
Facing huge debt, Italy has been conducting intensive negotiations for weeks with representatives of Chinese investment funds trying to get them to buy Italian government bonds and shares in leading Italian companies. Italy is carrying a national debt load of 1.9 trillion euros. Interest rates for the euro-zone member have gone up sharply over the past few weeks, and they may not be able to pay. To widespread criticism, the European Central Bank has been buying Italian bonds.
Now it's up to China to decide. The country is sitting on forex reserves amounting to $3.2 trillion. Little wonder, then, that Wen Jiabao is a welcome guest in financially-strapped eurozone countries. "If Europe is having difficulties, we will extend a helping hand," he promised last June during another trip to Europe. If necessary, they would buy euro-zone country government bonds in appropriate quantities.
Such words are music to Greek, Italian, Spanish and Portuguese ears. The second largest economy in the world playing savior of the euro! The debt-plagued Europeans seem to be able to forget all too easily that China is a dictatorship. "Good friends are there to help when someone needs it," said Wen Jiabao at a meeting with his Greek counterpart George Papandreou. Such dulcet sounds are enough to move Athens to tears.
In Germany, and other relatively wealthy euro-zone countries, all this meets with a healthy dose of mistrust. If China is buying European government bonds, EU Commissioner Günther Oettinger noted recently, it is most certainly not out of charity: "China takes over the EU, and we Europeans sell our souls."
What's China's stake?
Nobody knows exactly how much money China has already invested in European government bonds. In Italy, the number is apparently 4% of total debt, which would amount to 76 billion euros. In Spain, Portugal and Greece, several billion more. However, as the latest worsening of the euro crisis shows, China's move did not influence financial markets.
But it's enough for China to be seen as a potential savior in case of dire emergency. The apparent generosity of the new economic superpower is aimed at changing European perceptions and polishing up China's image. China needs to win the confidence of European trade partners because that will mean quicker acceptance of it as a market economy -- thus removing various constraints with regard to trade with the EU. The EU – not the United States -- is China‘s most important trading partner.
But China has also been investing directly in European companies. The country is seeking to build down its reserves of dollars and transfer more capital to Europe. The People's Bank of China recently bought strongly into Munich Re. And in early August, Lenovo, the Chinese computer manufacturer, bought a majority holding in German consumer electronics company Medion.
Germany is officially China's most important European partner, but so far they've held off with the really big investments out of fear of political pushback such as occurred in 2008 when Dresdner Bank was up for sale and an alleged offer from China unleashed a storm of political concern.
In the last five years, China has invested $218 billion worldwide according to estimates of the U.S.-based Heritage Foundation. Of that, 34.8 billion euros went to Europe, $28 billion to the United States, and $61 billion to Canada and South America.
China is spending a lot on infrastructure projects. In Greece, the Chinese logistics company Cosco controls the largest container terminal in the port of Piraeus for the next 35 years. In Iceland, a country that was also ravaged by the financial crisis, a Chinese investor bought up half of Stormur Seafood. China has also invested in the construction of a deep-water harbor in Iceland and the expansion of Keflavík International Airport. Such projects generate a lot of brownie points with local populations and give Wen Jiabao leverage to take pot shots at the Anglo-Saxon finance economy model.
"No to a speculation economy," he said recently on a state visit to Hungary, adding: "Our economy is based on work."
Read the original story in German
Photo - World Economic Forum
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Anne-Sophie Goninet, Jane Herbelin and Bertrand Hauger
October 25, 2021
Welcome to Monday, where an apparent coup is underway in Sudan, Colombia's most-wanted drug lord gets caught, and Michael Jordan's rookie sneakers score an auction record. We also focus on a report that the Thai government is abusing the country's centuries-old law to protect the monarchy from criticism (lèse-majesté) to target pro-democracy activists and protesters.
[*Zdraveite - Bulgarian]
🌎 7 THINGS TO KNOW RIGHT NOW
• Developing: Sudan leaders arrested amid military coup reports: Soldiers have arrested several members of Sudan's transitional government as well as civilian leaders, and Prime Minister Abdallah Hamdok has reportedly been put under house arrest, in what the information ministry called a military coup. Pro-democracy protesters have taken to the streets of the capital city Khartoum where there are reports of gunfire and clashes.
• Colombia's most wanted drug lord to be sent to U.S.: Colombia's most dangerous drug trafficker, known as Otoniel, was caught after a joint army, air force and police operation and faces extradition to the U.S. He led the country's largest criminal gang, and was on the U.S. most wanted list for years.
• Xi speech marks China's UN anniversary: China's President Xi Jinping marked the 50th anniversary of Beijing's entry into the United Nations with a speech calling for greater global cooperation, adding that issues like climate change, terrorism and cyber security needed multilateral solutions. Taiwan was not mentioned.
• German ISIS bride jailed for crimes against humanity: A German court has sentenced a German woman and former member of the Islamic State to 10 years in prison for letting a 5-year-old Yazidi enslaved girl die of thirst in Iraq. The case is one of the world's first trials to prosecute a war crime against the Yazidis.
• COVID update: The Beijing marathon scheduled next weekend has been postponed until further notice as China seeks to stamp out Delta variant outbreak and return to zero cases ahead of the Winter Olympics next February. Meanwhile, coronavirus cases in Eastern Europe have surpassed the 20 million mark as the region fights against its worst outbreak since the pandemic started and vaccination efforts lag.
• Goodbye, Gunther: U.S. actor James Michael Tyler, best known for his role as the barista Gunther on the TV show Friends, has died at 59 of prostate cancer.
• Sneakers record: A pair of Michael Jordan's white-and-red Nike shoes, which he wore during his rookie season with the Chicago Bulls in 1984, sold for $1.47 million — a new record price for sneakers at auction.
🗞️ FRONT PAGE
"The end of a boss," titles Colombian daily El Espectador, reporting on the arrest of drug lord Dairo Antonio Usuga, known as Otoniel, who had led Colombia's largest criminal gang and had been on the U.S. Drug Enforcement Agency's most wanted list for years. He was captured in a raid and will be extradited to the U.S.
#️⃣ BY THE NUMBERS
A Georgia man is being prosecuted for wire fraud after spending most of his business's COVID relief loan to buy one Pokémon trading card for $57,789.
📰 STORY OF THE DAY
How Thailand's "Lèse-Majesté" law is used to stifle all protest
Once meant to protect the royal family, the century-old law has become a tool for the military-led government in Bangkok to stamp out all dissent. A new report outlines the abuses.
👑 Thailand's Criminal Code "Lèse-Majesté" Article 112 imposes jail terms for defaming, insulting, or threatening the monarchy, with sentences of three to 15 years. This law has been present in Thai politics since 1908, though applied sparingly, only when direct verbal or written attacks against members of the royal family. But after the May 2014 military coup d'état, Thailand experienced the first wave of lèse-majesté arrests, prosecutions, and detentions of at least 127 individuals arrested in a much wider interpretation of the law.
🚨 The recent report "Second Wave: The Return of Lèse-Majesté in Thailand," documents how the Thai government has "used and abused Article 112 of the Criminal Code to target pro-democracy activists and protesters in relation to their online political expression and participation in peaceful pro-democracy demonstrations." The investigation shows 124 individuals, including at least eight minors, have been charged with lèse-majesté between November 2020 and August 2021. The new wave of charges is cited as a response to the rising pro-democracy protests across Thailand over the past year.
💻 The more than a century-old law is now largely playing out online, where much of today's protest takes place in Thailand. Thai student activist Juthatip Sirikan says people are willing to go further on social media to expose information such as how the king intervenes in politics and the monarchy's accumulation of wealth, information the mainstream media rarely reports on them. Not surprisingly, however, social media is heavily monitored and the military is involved in Intelligence operations and cyber attacks against human rights defenders and critics of any kind.
➡️ Read more on Worldcrunch.com
"Children are going to die. People are going to starve."
— The United Nations warns that Afghanistan verges on a "total breakdown" as millions of Afghans, including children, could die of starvation unless urgent action is taken by the international community. The agency calls for the release of frozen assets to avoid economic and social collapse, despite concerns over the Taliban government. A recent report said that about 97% of Afghanistan's population may sink below the poverty line, and World Food Programme (WFP) Executive Director David Beasley warned that more than half of Afghanistan's population of 39 million were facing acute food insecurity and "marching to starvation" in comparison to 14 million two months ago.
🕌 🔍 IN OTHER NEWS
Dutch cities have been secretly probing mosques since 2013
At least ten Dutch towns and cities have secretly used a private agency to probe mosques and other local religious organizations, Amsterdam-based daily het NRC reports in an exclusive investigation.
The clandestine operation — funded by NCTV, the National Security Services, the Netherlands' leading counter-terrorism agency — was prompted by the social unrest and uncertainty following multiple terror attacks in 2013, and a rise in Islamic radicalization.
The NCTV, which advises and financially supports municipalities in countering radicalization, put the municipalities in touch with Nuance by Training and Advice (Nuance door Trainingen en Advies, NTA), a private research agency based in Deventer, Netherlands. Among the institutions targeted by the investigations, which came at a cost of circa 500,000 euros, were the Al Mouahidin mosque in the central Dutch town of Ede, and the Nasser mosque east of the city of Utrecht, according to NRC.
Unlike public officials, the private agency can enter the mosques to clandestinely research the situation. In this case, the agents observed activity, talked to visitors, administrators, and religious leaders, and investigated what they do and say on social media.
All findings then wound up in a secret report which includes personal details about what the administrators and teachers studied, who their relatives are, with whom they argued, and how often they had contact with authorities in foreign countries, like Morocco.
It is unclear whether the practice is legal, which is why several members of the Dutch Parliament are now demanding clarification from the outgoing Minister of Justice and Security, Ferd Grapperhaus, who is said to be involved.
"The ease with which the government violates (fundamental) rights when it comes to Islam or Muslims is shocking," Stephan van Baarle, member of the leftist party DENK, told De Volkskrant, another Dutch newspaper.
Leaders of the Muslim organizations that were secretly probed say they feel betrayed. Hassan Saidi, director of one of the mosques investigated, said that the relationship with the local municipality had been good. "This puts a huge dent in the trust I'd had in the municipality," he told the Dutch public broadcaster NOS.
✍️ Newsletter by Anne-Sophie Goninet, Jane Herbelin and Bertrand Hauger
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