The Vineyard of the Saker
A blue dot barely visible from New Silk Roads
Pepe Escobar
An economics, investment, trading and policy blog with a focus on Modern Monetary Theory (MMT). We seek the truth, avoid the mainstream and are virulently anti-neoliberalism.
The greatest merit of Parag Khanna’s new book, The Future is Asian, is to accessibly tell the story of a historical inevitability – with the extra bonus of an Asian point of view. This is not only a very good public service, it also blows out of the water countless tomes by Western “experts” pontificating about Asia from an air-con cubicle in Washington....Good backgrounder.
The concept of Greater Eurasia has been discussed at the highest levels of Russian academia and policy-making for some time. This week the policy was presented at the Council of Ministers and looks set to be enshrined, without fanfare, as the main guideline of Russian foreign policy for the foreseeable future.
President Putin is unconditionally engaged to make it a success. Already at the St Petersburg International Economic Forum in 2016, Putin referred to an emerging “Eurasian partnership”.
I was privileged over the past week to engage in excellent discussions in Moscow with some of the top Russian analysts and policymakers involved in advancing Greater Eurasia.…Important.
Western critics continue to pour cold water on China’s Belt and Road Initiative (BRI), an ambitious and well-planned architecture connecting the massive Eurasian landmass through a system of roads, railways and ports. They complain that it lacks transparency, erodes trade standards set up by the West, is financially too huge for China to handle, is self-serving, and is a deceptive vehicle for China to dominate the world, just to name a few.
About $900 billion worth of infrastructure developments are now either underway or in detailed planning stages, according to the China Development Bank; this map highlights some of the signature projects.Fortune
There will be a safe, convenient and efficient system of China-Europe direct cargo trains by 2020, the country's top economic planning body has said.
It is estimated that there will be around 5,000 cargo trains running between China and Europe annually by 2020, according to a development plan issued by the National Development and Reform Commission.
As a key component of the Belt and Road initiative, direct cargo trains will connect a growing number of cities in China and Europe.
Demand for rail cargo service between China and Europe has exploded in recent years because it offers an alternative to slower and riskier sea freight and much costlier air cargo.…
The European Union has been China's largest trading partner for more than a decade, while China is one of the EU's biggest sources of imports. Bilateral trade amounted to 3.51 trillion U.S. dollars in 2015.
The People’s Bank of China injected a combined $31 billion into two policy banks linked to the New Silk Road project, said inside sources.
The central bank converted $16 billion worth of foreign exchange loans to China Development Bank (CDB) into equity shares in the bank, according to sources with knowledge of the matter, reported Chinese news site Caixin. It did the same with $15 billion worth of forex loans to Export-Import Bank of China (Exim). This follows a similar trade in April, when the PBOC invested $32 billion in CDB and $30 billion in China Exim.
The central bank is now the biggest shareholder in China Exim and the third-largest shareholder in CDB, after the Ministry of Finance and Central Huijin Investment.China realizes that the cost of capital is zero.
Both banks have been given the job of supporting the central government’s New Silk Road Economic Belt initiative.