Shanghai Cooperation Organisation (SCO) and Global South strategic cooperation

We are getting another step closer to completing the Jakarta-Bandung high speed rail in Indonesia. One of the signature BRI projects in Indonesia.

Well, Biden snubs Thailand for his granddaughter's wedding.

Well, Saudis want to join BRICS. I'm assuming SCO at some point too. But Petroyuan would be nice if they can agree to it soon.

A few more things to think about. Digital yuan has now crossed 100 billion RMB mark. Not a lot, but it's growing rapidly. They will probably be looking to use it to pay for gas/oil with Russia/Iran in the future.

overall, I think Digital Yuan is more about bigger business rather than individuals. Alipay+ is very important and it's not a good idea for Chinese gov't to suppress it or anything like that. Most recently, Alipay now allow money transfer with WeChat Pay. Seems like a good step in eventually allowing Alipay to be even more dominant.
This about what this 2 pieces of news mean. Now, you don't need to be Alipay user to do transactions in other countries and you will still use Alipay+. Someone from Korea going to Singapore don't need to exchange cash. They can just continue to use their KakaoPay app. It's good for customers and great for Alipay. It also gives the alipay+ customers a leg up over their local competition
Again, Alipay is seeking to take over personal payment services across all of East Asia. The only way you do that is making things more convenient and add more businesses.

And as usual, China's prime target when it comes to taking over financial services is ASEAN countries.
Personal finances is a small part of it. Doing cross border trading in Yuan is a huge part of this. In terms of business to business transaction, RMB is still much less than USD in its ASEAN backyard. There is a lot to grow here, starting with China's own direct trades with ASEAN countries. Eventually, they'd want more trading between ASEAN countries in RMB.

Another piece of news is that HK is allowing trading on HKEX in RMB. This is another great way to slowly increase RMB exposure to rest of the world. You cannot achieve currency importance unless you allow these things.

They are certainly building a lot of "silk roads" through Russia. I guess having additional highway adds to the type of cargos they can carry across Russia. Should allow for more convenient transportation/trade into interior part of Russia.

tphuang said:

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They are certainly building a lot of "silk roads" through Russia. I guess having additional highway adds to the type of cargos they can carry across Russia. Should allow for more convenient transportation/trade into interior part of Russia.

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This is a high speed highway linking Belarus to China. It will be plowed by unmanned trucks, maybe even using magnetic levitation.

Turns out Biden snubbing Thailand for granddaughter's wedding is a big deal. Xi better show up

It would seem to me that Thailand would be interesting in more cooperation from China for various sectors. BYD factory there is a good start, but there are a bunch of fields that Chinese tech companies are expanding into. Chinese tourism coming back to Thailand would also help their cause.

keep in mind that there are a lot of Thai people of Chinese descent and especially in business. There are a lot of strong areas of cooperation. I think Xi would look to strengthen a lot of these ties as well as getting into more security partnership with Thailand.

the other big visit for xi would be the G20 meeting in Jakarta. That's another big opportunity for relationship building.

I also expect there to be increasing cooperation with the Saudis. Xi will likely meet with MBS there.

With the recent Saudi/US spat, Saudis are eager to get involved with BRICS countries. We now see China supporting Saudi joining BRICS and for increased cooperation on oil.
I keep wondering when the petroyuan news will finally come out.

This will be a nice partnership. China/Saudis helping Pakistan's oil industry.

Financial/Digital markets are very important. I think news like this where China is looking for more cooperation with Thailand in this sector is not just needed but should be pushed forward with all the ASEAN countries.
China cannot only be the supplier of infrastructure and manufacturing. It needs to get into every aspect of its neighbors.

Finally, Yuan usage/payment continue to go up in SWIFT. Slow and steady. The first step is for China to be paying all the natural resources in RMB. It just paid iron ore from BHP for the first time in RMB. Now, it will be able to push this to all the iron ore players. Similarly, I see China pushing Petroyuan to all the oil producers. keep in mind that everything starts with Russia being eager to move to RMB. Once you get a huge natural resource supplier wanting to trade with you in RMB, all the other suppliers can be persuaded to do the same.

More on the relationship between China and Saudi Arabia

The two sides also exchanged views on cooperation and joint investment in countries along the China-proposed Belt and Road Initiative as well as investment in refinery and chemical integration projects in the two countries.

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Saudi Arabia would like to use its geographical advantages linking three continents to build a regional center for Chinese manufacturers so as to strengthen cooperation in the energy supply chain, according to the statement.

The two sides also agreed to conduct cooperation within the framework of the intergovernmental agreement on the peaceful use of nuclear energy and agreed that the cooperation between China and Saudi Arabia in the fields of electricity, renewable energy and hydrogen energy is of great significance.

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From last post, we've already seen that China/Saudi are co-investing into building refineries in Pakistan. Sounds like this is something they are going to work together going forward. They've also built new such facilities in China this year. China is know to have excessive refinery capacity that it's not using.
Note that this is from March. Along that line, looks like China will try to export nuclear reactors and probably solar energy to the Kingdom. I'm not sure about regional center for Chinese manufacturing. I think there will have to be better infrastructure linking China to the Middle East first.

Another country that has wanted to join BRICS is Algeria. We've known that Algeria has been buying up Chinese weapons like mad in the past couple of years. This is possibly a model that can be used across more countries in the Middle East. Weapons for hydrocarbon access and involvement in technology/infrastructure. Other countries include Egypt, UAE, Qatar and Libya.

There is a lot of heat on the Scholz gov't for allowing the COSCO/Hamburg investment to go through. Fundamentally, the NATO security establishment doesn't understand why China invests in these ports. If they did, they should be more alarmed about the China/Europe railway than Hamburg deal.

Most recently, China launched the first ever inter model freight to Morocco through Hamburg port.
You can see the benefits in utilizing Hamburg port when it comes to getting trade from China to British Isles, Scandinavia, Portugal, North/West Africa. I will however be battling China's other port investment in Greece and Italy. I think China would prefer to use Hamburg because it utilizes the more efficient shipping/port management that Germans already have. A dedicated terminal for goods from East and Central Asia managed by COSCO and its fleet would allow more commerce through Hamburg to places as far as east coast of Canada/USA.

I tried to explain here using BYD as my example, Just think about a car produced by BYD's Kazakhstan factory that gets moved across China-Europe railway express, put on a PCTC to London. Now, BYD gets to sell a car in UK or other part of Europe without any possible China tariff. To me, that would be more convenient delivery than building in Zhengzhou, moved to Shenzhen and get on a PCTC there and go around the cape to Western Europe.

More than anything, this allows China to control more of the commerce from central Asia to Western countries and also possibly from Japan/SK to all of Europe.

tphuang said:

There is a lot of heat on the Scholz gov't for allowing the COSCO/Hamburg investment to go through. Fundamentally, the NATO security establishment doesn't understand why China invests in these ports. If they did, they should be more alarmed about the China/Europe railway than Hamburg deal.

Most recently, China launched the first ever inter model freight to Morocco through Hamburg port.

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You can see the benefits in utilizing Hamburg port when it comes to getting trade from China to British Isles, Scandinavia, Portugal, North/West Africa. I will however be battling China's other port investment in Greece and Italy. I think China would prefer to use Hamburg because it utilizes the more efficient shipping/port management that Germans already have. A dedicated terminal for goods from East and Central Asia managed by COSCO and its fleet would allow more commerce through Hamburg to places as far as east coast of Canada/USA.

https://twitter.com/i/web/status/1584322431845814272

I tried to explain here using BYD as my example, Just think about a car produced by BYD's Kazakhstan factory that gets moved across China-Europe railway express, put on a PCTC to London. Now, BYD gets to sell a car in UK or other part of Europe without any possible China tariff. To me, that would be more convenient delivery than building in Zhengzhou, moved to Shenzhen and get on a PCTC there and go around the cape to Western Europe.

More than anything, this allows China to control more of the commerce from central Asia to Western countries and also possibly from Japan/SK to all of Europe.

Click to expand...

I think it's simply about saving money on port fees. If a third of all trade in Hamburg is with China, of course cosco will want a piece of the profits the port makes from that. In other cases like Piraeus, Chinese management is also necessary to make the port more efficient and accept more trade from China, but that shouldn't be a problem in Hamburg

China discusses with the Argentine government the construction of railways in the country. The government of Argentine President Alberto Fernández said it was discussing with the Chinese company China Railway International Group railway construction projects in several provinces of the country.

Infrastructure projects are discussed within the framework of the "One Belt, One Road" initiative, which Argentina joined this year. Argentina announced in February that it had joined China's "One Belt, One Road" initiative and said it would receive more than $23 billion from China to fund various projects.

el-pais