China on a Global Shopping Spree

Sunday, February 22, 2009

Times may be looking bleak for Chinese workers, but for China’s leaders and the banks they control, the global economic crisis is an opportunity to make investments around the world at bargain prices. This month alone, China has signed oil agreements with Russia, Brazil and Venezuela worth $41 billion. The Chinese will loan money to failing banks in the U.S. and elsewhere as a favor, but are more interested in securing long-term access to real resources. In addition to their oil buys, the Chinese invested $19.5 billion in Rio Tinto, Australia’s debt-ridden mining giant, which specializes in aluminum, copper and iron. With $2 trillion in foreign currency reserves, China is now able to compete for resources with the United States and other wealthier countries, particularly in Africa and in countries with which the U.S. is not on the best of terms, such as Iran and Venezuela. In Saudi Arabia, atheist China even signed a deal to build a train to Mecca from the equally holy Islamic site of Medina.

China’s Resource Buys (by Rachel Ziemba, RGE Monitor)
China Starts Investing Globally (by David Barboza, New York Times)


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