E.U. Begs China for Dumb Money

Sarkozy and his dumb money headache

The Wall Street and City of London attack on the Euro and the most recent fall of the Euro against the US-Dollar have forced the EU to beg China for a rescue package. China´s response, “we don´t hand out dumb money”. By Dr. Christof Lehmann

May be it is the recent attack on Russia and China via a coup d´etat in Ivory Coast, the war on Libya (1) and the covert war on Syria that have disgruntled the Chinese government. One thing is certain, China has reason to be reluctant when the the EU both wants to wage a war against China (2) and then ask China to finance it.

Last week the EU begged China for a substantial bailout loan. The response from Chinese officials was that they resent being perceived as “just a source for dumb money” and insisted that criticism of Chinese economic policies had to stop before offering any assistance to the EU.

Chief Executive of the European Financial Stability Facility, Klaus Regling visited Beijing for talks with Chinese officials, only one day after EU leaders had struck a last minute accord on the debt crisis that is shaking the EU´s economy.

Huan Jintao - We don´t give out dumb money

French President and current EU President Nicolas Sarkozy said that he had spoken on the telephone with Chinese President Hu Jintao. Hu Jintao expressed his relief over that the EU had announced a deal that is supposed to tackle the ongoing Euro crisis that has the potential to collapse the world economy. In an interview on Chinese TV Hu Jintao said “China has a major role to play. China must deploy more resources to stimulate the world economy: If countries decide to invest in the Euro rather than the dollar, why reject that?” Hu´s statement on TV can be understood as a signal to the US as well as the EU to cease their military aggressions against nations that are dealing or attempting to deal in other currencies than dictated by the US or EU. Examples of these aggressions are the Ivory Coast and the ousting of Laurent Gbagbo earlier this year, after Gbagbo announced that Ivory Coast considered to leave the French controlled CFA Region. The war on Iraq after Iraq chose the Euro over the US-Dollar is another example, and the attack on Libya, with Libya lobbying for a Pan-African Gold Dinar a third.

The Chinese refusal to provide a substantial rescue package for the EU and Euro should also be seen within other important contexts. One of them is that both Russian and Chinese Intelligence Services fear NATO plans to implode the world economy and initiate a global conflict (3). A massive Chinese loan to the EU, which economy can not be salvaged unless programs nobody at Wall Street nor the City of London ever would agree to, would have seriously endangered the Chinese economy when the inevitable EU crash becomes imminent. At the latest Greek attempt to sale state obligations only about half were sold, and against an annual interest rate of 100 %. No economy in the world can carry that burden. To slash 50 % of Greece´s debt holdings does not cut it either.

Regling may have said that the bailout of Greece was an exceptional case and that he would not believe such bailout would be repeated for other nations, but no fund is big enough to cope with the very likely collapse of the Italian and Spanish economy. Italy´s borrowing costs have hit EU area high´s, and austerity cut´s are not cutting it either.

One might ask, whom was Regling trying to convince at a Beijing News Conference on Thursday, when he referred to China´s 3.2 Trillion USD of foreign exchange reserves and said that “we all know China has a particular need to invest surpluses”.

Regling is right, China needs to invest it´s surpluses. But then again, China does not invest dumb money. Chinese economists very well understand that investing in joint ventures in Africa is a far better idea than investing into EU and US Funny Papers. China would also know better than investing in economies that wage wars against it in Libya, Ivory Coast the African Continent and Asia. European Economist and politicians, including war mongering Sarkozy should know that a dog that bites the hand that feeds it is bound to starve. Late night calls to Hu won´t change that.

Christof Lehmann


About christoflehmann

Christof Lehmann is the founder and senior editor of nsnbc. Christof Lehmann is a political writer, psychologist, and independent political consultant on a wide range of issues, including conflict and conflict resolution, negotiations, security management, crisis management. His articles are published widely in international print and online media and he is a frequent contributor to radio and TV programs. He is a lifelong advocate for human rights, peace and international justice and the prosecution of war crimes - also those committed by privileged nation. In September 2011 Christof Lehmann started the blog nsnbc in response to what he perceived as an embargo on truth about the conflict in Libya and Syria. In 2013, he plans to transform nsnbc into an independent, daily, international online newspaper.
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