China badly wants to take the Czech Republic, and the Czech Republic wants to be taken. So what’s the problem?
Czech President Milos Zeman has met with Chinese President Xi Jinping eight times — an unusual amount of face time for the leader of 10 million people.
Zeman has welcomed Chinese investment and tried to position his country as China’s portal to Europe. He even appointed a Chinese business tycoon, Ye Jianming, as an economic adviser. Ye, the chairman of energy company CEFC China, proceeded to buy stakes in a Prague soccer team, a brewery, an airline, a media company and an investment bank.
Meanwhile, China hired former Czech ministers and other retired politicians to press its case in Prague.
“They’re [Czech elites are] trying to rearrange the political arrangements to be more conducive to Chinese interests,” said Martin Hala, director of Sinopsis, a group that studies Chinese influence in Central Europe. “Some systems are more resilient than others.” __ WaPo
But recently China has been proving reluctant to consummate the relationship. What could possibly be wrong? No money, no honey? In an economic squeeze, even a high-rolling “John” like China has to become more selective.
China Debt is Over the Tipping Point
China economist Michael Pettis has been warning about treacherous levels of Chinese debt for several years now. And other observers are starting to notice the problem
“China is very much past the tipping point where the debt simply no longer can be ignored. The cost of servicing the debt … simply distracts from almost everything else,” said Howie.
China’s total debt — corporate, household and government — rose to over 300% of its GDP in the first quarter of 2019, slightly up from the same period a year earlier, according to a report by the Institute of International Finance.
“China … (had) this huge stimulus and turn on the credit taps and they drove all this global demand,” Howie said. “But there clearly was going to be a cost … and now they are suffering (from) it.”
China’s debt levels rapidly shot up a few years ago as its banks extended record amounts of credit to drive growth, which led to the Asian giant undertaking deleveraging efforts, or the process of reducing debt.
But the trade war has put a dent in its efforts to pare its massive debt as Beijing sought ways to boost its slowing economy, which was at its lowest growth in 27 years. Earlier this year, banks started to increase its lending again, with new loans surging to a record high. __ https://www.cnbc.com/2019/08/23/chinas-debt-levels-amid-its-slowing-economy.html?
China simply cannot learn its lesson. The Communist Party of China is too fixated on global domination to the point that it is unable to stop — even to remove a poisoned splinter from its rapidly swelling foot.
Donald Trump seems to be the first US president to notice the threat from Communist China. He is limited in what he can do on his own, but he seems willing to swing his big stick in unpredictable fashion to keep Beijing guessing. His unconventional tactics are having an effect on the Chinese economy, where capital flight is once again taking wings.
Meanwhile in Hong Kong
Hong Kong protests often feature millions of protestors at a time, something rarely seen elsewhere in the world. Beijing would be nervous even with just a fraction of that number turning out in the streets — but millions? Antiperspirant deodorant must be selling off the shelves in Beijing’s exclusive convenience marts. Especially since so much of the wealth of China’s elites is moved in and out through Hong Kong channels.
Hong Kong is irreplaceable to China. If China destroys international trust in the integrity of Hong Kong, then a huge arterial of wealth will dry up for China and a large number of other global players. It will not be Shanghai or Shenzhen that picks up the lucrative remains, but rather Singapore. The CCP leadership is aware of the problem.
This is not a problem that the Communist Chinese want to deal with at this particular time, but there it is. One of the world’s most prestigious financial capitals clearly wants to keep its distance from Beijing. It is almost as if Hong Kong is afraid of catching a sexually transmitted disease from the dirty commies.
People around the world are watching. Perhaps even people in the Czech Republic?
Belt and Road projects are being canceled in Africa and across Asia. Beijing’s debt-slave diplomacy flagship is not being received as favorably as previously — especially in democratic nations where a new set of leaders revokes China deals made by previous corrupt leadership. Democracy — what a nuisance for aspiring global hegemons!
Meanwhile: This is what happens when you tell the truth inside China…
Tiananmen Square is a much smaller place than Hong Kong… with much less economic significance. The CCP risks letting things get out of control if they overstep.
China trade war: better now than later
China has a lot more to worry about:
China is now an unpredictable hybrid monster, budding off a motley mess of progeny that threaten the survival of the parent monster. Chaos ensues.