US-China trade talks come to a close with no deal

With two weeks remain before the end of the tariff truce US and China trade meeting ended today with no resolution. Delegates from the US and China met in Beijing with hope coming to some deal and bring an end to the trade war.

The meeting between Chinese Vice Premier Liu He and US Trade Representative Robert Lighthizer as well as Chinese president Xi Jinping who joined the meeting, later on, seems to have resulted in no progress as no statement was released at the close of the meeting.

The US is seeking close the trade deficit it has with China the reason for the tariffs in the first place while China is looking for a way to re-engage with the US and still keep its trade output levels relatively the same. So far both countries are hurt from the Trade war as China economy slow so is the US.


By Mokgethi Mtezuka

The total abandonment of the US currency is premature talk – Dmitriev

The BRICS New Development Bank (NDB) is a threat to the hegemony of the US dollar – the creation and launch of the NDB was referred to as an international anti-dollar alliance. As a result, prospects of the coalition of Brazil, Russia, India, China, and South Africa ‘de-dollarizing’ – creating a single currency of the BRICS countries that would ultimately replace the dollar, have been in discussion on the media. 

BRICS agreeing to cooperation on Fourth Revolution, cryptocurrencies further sparked conversations of the grouping abandoning the dollar. BRICS first discussed Crypto in 2017. 

Kirill A. Dmitriev CEO of the Russian Direct Investment Fund and member of the BRICS Business Council, however, says that “it is premature to talk about total abandonment of the US currency”.

Dmitriev who was being interviewed by Brasil Sputnik on the prospects for financial cooperation under the BRICS and whether the bloc will in future find an alternative to the dollar, further said that BRICS countries focus on using their own currencies in transactions between them while the Chinese yuan plays an increasingly important role.

 

By: Kgothatso Nkanyane

Tata CEO on BRICS institute’s Advisory Board

Len Brand, CEO of Tata Africa Holdings accepted the invitation for a position on the BRICS institute Advisory board. The BRICS Institute is an independent institute, directed by an Advisory Board comprising remarkable leaders from business, the diplomatic corps, government, and academics. 

In accepting the position, Brand has dedicated himself to assist in developing world-class leaders and fostering real economic growth and shared prosperity between China, the BRICS countries and the world.

The Institute is presided over by 20 members who form the Advisory Board, which comprises several subcommittees who focus on research, knowledge development and innovation. The institute works in close collaboration with Regenesys Business School and draws on the support of senior academic, research and consulting staff, representing all the BRICS countries.

The BRICS Institute was launched at Regenesys Business School on the 14th of June 2018.

READ MORE: The BRICS Institute has officially launched

The Tata CEO has said that he is looking forward to making a positive contribution and further said he is certain that his industry expertise will be of benefit to the BRICS institute and its sub-committee members.

 

By: Kgothatso Nkanyane

India and China at the forefront the global greening effort

NASA has released information from a new study stating that India and China are leading in greening on land. This is based on data received from a satellite which captured the Asian’s two biggest economies and showed that they both much greener today than 20 years ago.

Together India and China account for one-third of the green on earth. The information has surprised experts as a factor such as land degradation and overpopulation seems to have little effect on the growing green in the regions. The study specifically highlights India and China as the most prevalent where the greening is occurring.

A large amount of the growing green in China is from forests 42% and 32% is from crops, while India 82% of the growing green comes from crops and almost 5% is from forest land.

 

Source: economictimes.indiatimes.com

Brazil the nation to most likely rapture BRICS?

China’s President Xi Jinping, Indian Prime Minister Narendra Modi, South Africa’s President Cyril Ramaphosa, Brazil’s President Michel Temer and Russia’s President Vladimir Putin pose for a group picture at the BRICS summit meeting in Johannesburg, South Africa, July 26, 2018. REUTERS/Mike Hutchings

The election of Brazil’s new President, Jair Bolsonaro has been seen as a dilemma for the BRICS (Brazil, Russia, India, China, and South Africa) grouping. This because of the Bolsonaro’s Presidential campaign messages – he promised: “liberate Brazil from the ideology of its international relations that it subjected Brazil to in recent years.”

The ” liberation of Brazil from socialism” as declared by the far right-wing President has been viewed as the collapse of the grouping. The future of the bloc has been foreseen as “RICS” – Brazil the nation most likely to rapture BRICS.

Brasilia’s stance on the Venezuela crisis is another factor the world is anticipating a ‘Braxit’. A crisis concerning who is the legitimate President of Venezuela has been underway since 10 January 2019, when the National Assembly (the oppositional majority)declared the reelection of Nicolás Maduro as invalid and declared Juan Guaidó as acting President. Brazil has declared support for Juan Guaidó, while Russia and China are rallying behind six-year President Maduro. Brazil joined the US in backing the acting President.

Brazil has, however, not announced an exit – the country has assumed the Presidency of the grouping.

READ MORE: Brazil to host next BRICS Summit in 2019

In an interview with IOL.co.za, South Africa Minister of International Relations and Diplomacy, Ms. Lindiwe Sisulu whether she foresees difficulty within the BRICS with Brazil’s new administration, its anti-China rhetoric and the country’s association with the US.

The Minster responded; 

BRICS is an association of willing partners who would like to assist each other. Governments come and ago and we are still hoping that the association will last. The President of Brazil has not broken away from BRICS, and he is the Chair of BRICS this year. We will wait and see what he has to say about BRICS, but I don’t expect that his relationships with other people will take him away from BRICS. We built the association over a long period of time and its successes speak for themselves – reports IOL.

 

By: Kgothatso Nkanyane

China-US trade talks make important progress for current stage, says Chinese delegation

The latest round of China-US trade talks made important progress for the current stage, and the two sides had candid, specific and constructive discussions, a Chinese delegation said on Jan 31.

Guided by the important consensus reached by the two countries’ heads of state in Argentina, the two sides discussed the topics of trade balance, technology transfer, protection of intellectual property rights (IPR), non-tariff barriers, service sector, agriculture and enforcement mechanism, as well as certain issues of particular concern for the Chinese side.

The two-day talks in Washington, which started on Jan 30, were led by Vice-Premier Liu He and US Trade Representative Robert Lighthizer, with the participation of dozens of senior officials from both governments.
Liu and Lighthizer held candid, specific and constructive discussions in particular on such topics of common concern as trade balance, technology transfer, IPR protection, and enforcement mechanism, as well as certain issues of particular concern for the Chinese side, according to the Chinese delegation.

Important progress has been made for the current stage, and the two sides also determined the timetable and roadmap for next-step consultations. Both sides attach great importance to the issue of IPR protection and technology transfer and have agreed to further enhance cooperation in this regard.

The Chinese delegation said that creating a market environment of fair competition goes in line with the general direction of China’s reform and opening-up, and therefore the Chinese side will actively address relevant US concerns.

The two sides have agreed to take effective measures to promote a more balanced development of bilateral trade. The Chinese side will make active efforts to expand imports from the United States in the sectors of agriculture, energy, manufacturing, and services, which will help China’s pursuit of high-quality economic development and meet the people’s demand for a better life.

The two sides also discussed some specific concerns of the Chinese side, and the US side said it would seriously address these concerns.

Both sides believe that it is very important to establish an effective two-way enforcement mechanism, so as to ensure all measures agreed upon through consultations will be implemented. They have reached consensus in principle on the framework and basic elements of the enforcement mechanism and will continue to hammer out more details.
The world has been watching the China-US trade talks closely, with many hoping for some substantial, positive progress to be made.

The talks marked a significant step in the implementation of the important consensus reached by President Xi Jinping and US President Donald Trump during a working dinner in Buenos Aires, Argentina, on Dec 1.
The two heads of state agreed back then that the two sides should try to reach a mutually beneficial and win-win agreement within 90 days to bring an early end to their months-long trade friction featuring massive tariffs on imports from each other.

 

China government news

 

Electric car maker Tesla bets big on China

Electric car maker Tesla is gambling big on the future growth of the electric car market in China. Through the building of a new Gigafactory in Shanghai, which CEO Elon Musk said should be up and running this year. The factory will produce Tesla products for China and the Region.

He also said that the US made Model 3 will be made available in China in 2019, though US-China trade relations are causing tension for Tesla and other US companies operating in China with fears that trade tariffs will be extended even further.

The number of electric vehicles in China has grown at a fast pace over years and are forecasted to reach 2 million by 2020 and 7 million by 2025. For Tesla being the first electric car company in China gives them a competitive advantage.

The biggest challenge for Tesla now is meeting the demand for electric vehicles fast enough, speeding up manufacturing and shipping from the US to China is one of the major concerns for Musk. This could further be dampened by more tariffs.

 

Source: cnbc.com

The clock ticks on US, China tariff truce

Time is running out for the US and China to come up with a deal that will bring an end to the trade tariffs. The two biggest economies in the world came to a truce late last year with both countries suspending new tariffs on each other, to allow room for negotiations to take place.

The deadline for the truce is coming closer as both sides still have yet to come to an agreement. This is leaving markets and business worried that new tariffs could be imposed.

According to cnbc.com China’s economy is also forecasted to slow down due to tariffs which will affect the US economy and to a larger extent the global economy.

Many in the business community do not believe that the US and China can make enough progress on their issue in a little over a month. US officials have expressed optimism that a consensus will be reached before the truce expires in March.


By Mokgethi Mtezuka

India, Japan & US key to Indo-Pacific stability

The chairman of the Nippon Foundation, Yohei Sasakawa, believes for increased stability and peace in the Indo-Pacific region India, Japan, and US cooperation will be a key element. This comes as China growing presence in the South China Sea becomes more prevalent.

India, Japan, USA, and Australia are a quartet working to strengthen ties and coordinate their activities in the Indo-Pacific which stretches from the east coast of Africa to the east coast of Japan. China’s One Belt One Road project, as well as growing influence in the South China Sea, has caused new tension in the region which has prompted the reestablishment of the quad in 2017.

Sasakawa believes that it may be already too late to contain a rising China as they are building massive projects in around the Pacific Ocean, Indian Ocean and on African coasts. The Chinese Overseas Development Aid (ODA) is seen by many critics as loans used to trap countries into debt.

Sikkim’s lone Lok Sabha MP P.D. Rai has referred to the relationship between India and Japan has been described as the bedrock of stability which could maintain stability in South Asia and East Asia in the years to come.

Source:indiatimes.com

NDB Successfully Registers RMB 10 Billion Bond Programme In China Interbank Bond Market

The New Development Bank (NDB) has successfully obtained the Letter of Registration (Zhong Shi Xie Zhu, 2019 No. RB1) of an RMB bond programme in the China Interbank Bond Market from the National Association of Financial Market Institutional Investors (NAFMII) on January 9, 2019. The NDB has been granted approval to raise up to RMB 10 billion in the China interbank bond market within 2 years of the Programme registration date. The proceeds of the Programme will be used to finance infrastructure and sustainable development projects in the Bank’s member countries.

The NDB is the first issuer to establish an onshore RMB bond programme according to the Interim Measures for the Administration of Bond Issuance by Overseas Institutions in the National Interbank Bond Market under the People’s Bank of China and Ministry of Finance Announcement [2018] No.16 (the Measures) issued on September 25, 2018.
Industrial and Commercial Bank of China Limited, Bank of China Limited, Agricultural Bank of China Limited and China Construction Bank Limited have been appointed as the joint lead underwriters of the Programme.


Bond offerings under the Programme will be eligible to institutional investors in the China Interbank Bond Market as well as offshore RMB investors through the Bond Connect scheme between Mainland China and Hong Kong.
Registration of the Programme reiterates the Bank’s commitment to becoming a regular issuer in China with a strong credit history in order to ensure better liquidity and diversification for investors.

“NDB will contribute to the development of financial markets in its member countries and raise funds not only in hard currencies but also in local currencies,” said Mr. Leslie Maasdorp, NDB VP & CFO. “We view China Interbank Bond Market as a very promising market that will offer the NDB an additional source of liquidity on an ongoing basis, supporting the growth of our investments in infrastructure and sustainable development projects in line with the Bank’s mandate,” he added.

In July 2016, the NDB successfully issued the first onshore bond in China for an amount of RMB 3 billion (approx. USD 450 million) and a tenor of 5 years. It was the first time that an international financial institution issued a green financial bond in the China interbank bond market and it was also the first time for the NDB to tap the capital market. The issuance was regarded as a great success, with the total subscription amounting to more than RMB 9 billion and the participation of more than 30 investors.


-New Development Bank