Thursday, March 19, 2015

US allies begin to worship the yuan instead of the dollar

USA - Aggressor 

FT: US allies begin to worship not the dollar but instead the yuan as a history with ADB infrastructure investment turns into a diplomatic disaster for the United States.

Planned, and then lost the fight with China for power and influence, Washington inadvertently signaled on which way it shifted power and influence in the 21st century.Once China in 2013 announced his intention to establish the bank, the United States began convince allies to boycott the new institution. 

The Americans argued that the new bank, which has the support of Beijing, will follow less stringent than those of the World Bank lending standards, such as openness and honesty of power, as well as protection of the environment. But it was quite clear that it is a struggle for power.

The World Bank in Washington, and its president has always been an American. His potential rival Asian Bank infrastructure investment will be based in Shanghai, and China will become its leading shareholder. Initially, Japan, South Korea and Australia have decided to stay away from ABII, as well as all major European countries.

However, the news that Britain intends to become a member and founder of the bank, has created a significant and important crack in the united front, oppose ABII. Last week I spent in South Korea, where the majority of analysts believe that after some time, too, Seoul take part in the new bank. Australia is reviewing its position, and the major European countries, too, can follow the example of Britain. 

Today, the only significant ABII opponents are Japan and the United States. It looks very bad for America. Instead of rallying their friends, collectively and take a principled stand against faulty enterprise, the US in this episode ABII look isolated and resentful. 

The story becomes even more balzomom the Chinese soul, because the country has gone through a couple of bad years in the course of his struggle growing America for power and influence in Asia. 

Occupying a more aggressive stance in territorial disputes with its neighbors, China unwittingly strengthened America's position in an environment where a number of countries, including the Philippines, Japan, Australia and India, seeking to strengthen ties with the United States in the field of diplomacy and security. 

Less confrontation But it seems China passed from this certain lessons. In recent months, he behaves less confrontational toward its neighbors, and instead emphasizes its commitment to the development of economic ties, including through the creation of the new Silk Road in trade and infrastructure, which will pass through Central Asia. 

This project will be carried out in parallel project "Maritime Silk Road", which will take place on the seas of Southeast Asia. ABII can play a role in the financing of these initiatives. Beijing hopes to persuade Asian countries is that the rise of China does not create any threat to them, and that they will benefit from its growing wealth. 

It seems that the majority of Chinese neighbors, as well as the British, their hopes for attracting investment from China, came to the conclusion that miss this opportunity to be stupid. The story of the ABII shows that in the struggle for influence in Asia, mainly China trump card is the growing economic strength of the country . 

Unlike China, chief US trump card - a military power and a set of agreements in the field of security. Those countries that were in the middle, face a dilemma. In Japan, Australia, the Philippines and South Korea have a security pact with the United States. 

But each of them are much more trade with China than with the United States. For example, South Korea relies on US military power in the reflection of a potential attack North Korea, and perhaps someday, and China itself.

But China today takes more than a quarter of South Korean exports, while in America it takes about 12%. As a result, the interests of South Korea often pull in different directions. One example of this - ABII. 

The second - in the country reaching a fierce debate on whether or not to give in the US request for placing on South Korean territory anti-missile system, which can be useful in the defense against the North, but that the Chinese consider a threat to their own security. 

The case will only increase the incentives ABII America Japan to sign a trade agreement on the Trans-Pacific Partnership, which is to unite the 12 countries of the Pacific region, but that defiantly do not include China. 

Again, the Americans argue that here we are talking about the observance of standards of economic openness, rather than trying to put together a block anti-Chinese. But even some US allies do not believe fully in these arguments, and someone says quietly that it is rather strange - to conclude a new trade agreement without the participation of China - the leading trading power in the Asia-Pacific region. 

In this Asian melee between Washington and Beijing is an important issue that ultimately will be more important: the American military force or economic power of China. The answer will vary depending on the specific situation. But in general, the more a country will feel threatened by China, the more it will lean towards America. 

That is why Japan is likely to remain the last bastion of Asian opposing ABII. Conversely, if China has shown enough prudence and common sense, not showing too often his fists, he has a good chance for the gradual transformation of its economic power in the growing political and diplomatic weight, even in relations with US allies. 

There was a time when you said that the world meekly bowing to the almighty dollar. But the story of the ABII says that even today many of America's closest allies in the eyes of the characters are cashing in on the yuan.

Europe Not Afraid to Defy US in Asian Adventure
As a trio of European countries have followed the UK's lead and decided to join the Asian Infrastructure Investment Bank (AIIB), a move seen as defiant by the US, former Italian MEP explained that the countries don’t want to miss the opportunity to pursue profitable and secured investments in the most dynamically developing region in the world.

Europe Gets ‘Foot in The Door’ in Asia by Joining AIIB

“The US government has involved so much effort and means not to let Europe participate in what Washington presents as a 'trap'”, the Italian journalist, politician and former MEP Giulietto Chiesa told Sputnik.

But, as they say in London, “business is business,' and the European countries don’t want to miss the opportunity, he added. China already dominates in the development of Asian infrastructure, transport, and energy. Investments in the area alongside such a partner will most likely be very profitable and well-secured. Therefore, Britain chose to enter the game. Germany, France and Italy are watching intently.

“Russia does not make its deep interest in the joint financial enterprise a secret,” he said. “If you just look at Siberia and especially Russia’s Far East, you’ll see that AIIB will most likely become the key tool in facilitating and attracting foreign investment from all over the world which could be 'secured' by China.

Soft Power: Beijing Offers Seoul to Join AIIB, Reject THAAD Deployment

Besides, it is also apparent that all the BRICS countries (Brazil, Russia, India, China and South Africa) will join in, with Iran also considering stepping in.”

It Won’t be Easy for the US to Deal With Competitor of Such Caliber

It won’t be easy for the US to deal with a competitor of such a caliber, Giulietto Chiesa added.

It's a sober fact that the last episode only proves the obvious – China is a new point of attraction for world finance, a center of gravity that is constantly changing Asia. And it is impossible to stop this ‘shift of power’, the politician stated.

The former MEP explained that the crisis of the Western economy, including that of the US, regardless of its growth, is artificial in nature; more often the finances are cut off from the production of commodities and services. Asia has taken the place of developed nations in the “material production” of amenities, at least from a mid-term prospective.

Therefore China has also stepped in, and the US plans to revise the rules of international trade, as is now being discussed at the TTIP (Transatlantic Trade and Investment Partnership) negotiations, which he claims are forced. These, he says, are aimed at forcing Europe to follow a path which is in America's interests and controlled by the US.

US Uses Current Credit Rating System to Spread Its Hegemony – Dagong CEO

In the US, the Asian Infrastructure Investment Bank (AIIB) was instantly positioned as a competitor to the Asian Development Bank, an English-American financial agent, which in tandem with the World Bank set the tone in Asia for decades, he said.

The Chinese government, standing its ground, has undertaken one strategic initiative after another.

Just as a quick reminder: in December 2013 Beijing created its own credit rating agency. Standard&Poors, Moody's and Fitch found themselves face to face with a new competitor, Dagong, the purpose of which is to deprive the “big troika” of its role as the final authority in defining the financial “health” of different states and transnational corporations. The emergence of the AIIB has the similar intentions

On Tuesday, France, Germany and Italy all agreed to follow Britain’s lead and join a China-led international development bank, according to European officials, delivering a blow to US efforts to keep leading Western countries out of the new institution.

The decision by the three European governments came after Britain announced last week that it would join the $50bn Asian Infrastructure Investment Bank, a potential rival to the Washington-based World Bank.

Australia, a key US ally in the Asia-Pacific region which had come under pressure from Washington to stay out of the new bank, has also said that it will now rethink that position.

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