THE CHINESE ARE BUYING UP PLANET EARTH

Those who have read my book, Economic Rip Tide, understand that the West sold the essence of its economy to the Chinese.

The essence or support of any economy is its manufacturing base. Without manufacturing an economy is simply a primitive system suitable only for survival.

When the Western money managers, formerly called capitalists, became frustrated with Western labor, they sold their manufacturing to China. They kept their Brands and Trade Marks in order to resell their products to their former employees, thereby making bigger profits with cheap Chinese labor than they made before with expensive Western labor.

In this process many Chinese entrepreneurs made billions of dollars. In collusion with the money managers of the West, these Chinese businessmen assembled factories and workers and produced whatever was wanted. The profits were enormous.

Rather than re-invest in China, where the government controls everything, they looked abroad for places where this accumulation of wealth would buy security for their future.

Since the Chinese are essentially agricultural people, their first thought was agricultural land. Today, we find teams of Chinese, bolstered by governmental experts, buying up agricultural land in South America and Africa.

These teams are looking for long term projects that will provide China with food, but which will produce a surplus which can be sold to the rest of the world.

The type of project that interests the Chinese most is the plantation model. These are huge agricultural production facilities that produce one or two products.

Here is an example from Africa:

“China has been seriously pursuing agricultural activities in Africa. It has been revealed that China will be sending 1 million farm workers to Africa in the course of the year.

China will be starting the world’s largest palm oil plantation in Congo. Covering an area of 2.8 million hectares, the palm oil plantation would be used for bio-fuels.

Next in line for China is Zambia where it is in the process of finalizing a deal to grow bio-fuels on 2 million hectares of land.

Besides growing crops for its own country, China is helping African agriculture to develop for its own progress. It is teaching newest techniques of farming, shifting from subsistence agriculture to growing cash crops that will ensure greater financial returns, and also providing education in the field by setting up Agricultural institutes in reputed universities.”

And here is a report from Rabobank about China in South America:

“China’s increasing investment in South American agriculture reflects a combination of factors

The volume of investment projects by Chinese companies in South America has been expanding exponentially since 2007. Brazil in particular provides an enormous potential market for Chinese exports, and has historically been a key partner for China in the energy, manufacturing, and other sectors.

China’s investment rationale: agricultural production and logistical infrastructure

China is aiming to secure the supply of agricultural products, especially grains and oilseeds, as it cannot meet its own demand for them. Several agriculture-related deals in South America – including its large concentration of soybean production and vast quantity of available land and water resources – address China’s food industry needs.

China’s entry strategy: from direct land access to a ‘leasing’ scheme

Banned from buying land outright, Chinese investors have changed their model to one in which deals are structured as infrastructure investments in exchange for crop offtake, rather than direct investment into farmland.

Flow of deals in South America, particularly in Brazil, expected to continue

China has an ongoing need to secure soybean and corn supplies that matches well with South America’s productive strengths. With grain stocks at historically low levels, the world will continue to look to South America for incremental production. Brazil has more resources that could be put into crop production than any other country in the world.”

In Europe a different approach is seen. Here investors are seeking to tap the tourist potential of Europe.

The people of the world see Europe as a giant museum and play ground, replete with fine restaurants and charming service people.

Europe is no longer considered a stable integrated economy with secure banks and high end manufacturing. The only stability remaining in Europe is its outstanding landscape and its thousands of old castles, statues and paintings.

The Chinese recognize this and are looking to set up chains of tourist attractions that will cater to the world’s touring crowd who always carry large quantities of money.”

Here is an example of a Chinese billionaire who failed. This man failed in Iceland, but I will guarantee that he will try again in another country.

From Bloomberg:

“Iceland’s government denied Chinese billionaire investor Huang Nubo permission to purchase land in the island’s north, saying such a transfer of property would be“incompatible” with the country’s laws.

The government won’t let Huang, through his company Beijing Zhongkun Investment Group Co., proceed with a planned acquisition of 300 square kilometers (116 square miles) of land, the Reykjavik-based Internal Affairs Ministry said in an e-mailed statement yesterday.

Icelandic law “imposes strict conditions on corporations wishing to acquire ownership or the right to utilize Icelandic properties and it’s clear that the company in question doesn’t fulfill any of the requirements,” the ministry said.

Huang planned to invest about $200 million to build a resort with a hotel, golf course and racecourse, according to an Oct. 26 article in China Dialogue. In a September interview with Bloomberg News, Huang said he was in talks to buy the land for $8.8 million from a group of farmers and was awaiting approval from the government. Huang is estimated by Forbes magazine to have a fortune of $1.02 billion.

‘Internal Struggles’

“Internal struggles between Iceland’s different political parties led to the rejection of the investment,” Huang said in an interview with the official Xinhua News Agency on Nov. 26.“A fair and reasonable international investment environment should not mean eyeing money in Chinese people’s pockets, while guarding against the Chinese in every possible way, and fearing they will take away the country’s resources,” Xinhua quoted Huang as saying.

Yao Chen, a Beijing-based public relations official at Zhongkun, said Huang wasn’t available to comment when contacted by Bloomberg News today.

Huang, 55 when he was interviewed on Sept. 25, said then he planned to establish resorts in nations such as Denmark, Finland and Sweden within five years. The Iceland land purchase would have been the biggest by a foreigner, according to Huang.

“If I have the site in Iceland, then I’ll expand to otherNordic countries,” Huang, who said he’s a poet and has climbed Mount Everest three times, said in Shanghai in September. “I’ll buy land and build resorts in Nordic countries, but they won’t be the magnitude of the project in Iceland.”

University Roommate

Huang said his connection with Iceland started 30 years ago when he was studying at Peking University. His roommate and good friend back then was from Iceland and later married a politician. Huang donated $1 million last year to set up an Icelandic-Chinese poet-exchange program.

Source: http://asiasociety.org/policy/center-us-china-relations/china-investment-challenge

Iceland, which is emerging from the failure of its bank industry in 2008, is now enjoying faster economic growth than the average in the euro area, the International Monetary Fund estimates. Iceland’s gross domestic product will expand 2.5 percent this year and next, compared with 1.6 percent in the 17-member euro area this year and 1.1 percent in 2012, the IMF said Sept. 20.

Since its financial meltdown, Iceland’s $12 billion economy has renewed its focus on core industries such as fishing, energy and tourism.”

CONCLUSION

These are only three of the examples of Chinese entry into the West with the money that they earned from Westerners buying their products.

I was recently in Vancouver, Canada. Vancouver is one of my favorite cities. It has a mixture of all the world’s cultures, fine restaurants and a cool, slightly damp climate. It is also a major port on the Pacific, so the seafood is unbelievably fresh.

When I traveled along the ocean front I marveled at all the new and magnificent housing.

Our friend from Hong Kong explained:

“Those castles are owned by Mainland Chinese. They don’t like to keep their cash in China. So they buy an old house here, tear it down and build a castle. That way they have an investment which grows in value and they can use it throughout the whole year for their family and friends. That makes sense, doesn’t it?”

“Yes,” I answered. “It makes a lot of sense.”

And, while the Chinese are buying up Planet Earth, the U.S. and the Europeans are in the Middle East shooting at anything that moves. Who do you think will be rich in fifty years?

Popularity: 1% [?]

Filed Under: Economy

Tags: AFRICA, billionaires, BUYING LAND, China, DR. PINNA, Europe, featured, ICELAND, INVESTMENT, SOUTH AMERICA, War