We like to go for Dim Sum on Sundays at Golden City Restaurant in downtown Victoria. Maybe it is the WASP in me but I always think that the food tastes better at a Chinese restaurant when the best looking parts of the menu are only in Chinese and most of the clients seem to be ethnically Chinese. That is the case at Golden City. We had a great meal yesterday and perhaps that is why all of today's articles are related to China.

Maybe also because our future excellent or otherwise will depend to some degree on China's fate.

In addition to the issues that will arise from China's relationships with its neighbours principally India, Russia, Japan and Vietnam, new strategic alliances that China is forging with non-Asian countries like Brazil and Iran will have important ramifications for Canada. At the middle of this nexus is the United States. The risk to Canada is that Washington will pressure Canada to choose on an issue that it differs strongly with China.

Like sanctions against Iran.

In 1996 Congress passed the Iran-Libya Sanctions Act with the aim of, among other things, pressuring the regime in Tehran to stop sponsoring terrorism. For a time, the sanctions did annoy those who wanted to invest in the Islamic Republic. But they soon withered away, since neither President Clinton nor President Bush wanted to sanction our European allies, who were among Iran's biggest trading partners.  http://online.wsj.com/article/SB10001424052748703453804575479791919603272.html?mod=rss_opinion_main

For a leadership that knows its history there are two very important lessons likely shaping their thinking.

First, the problem of access to raw materials exploited by President Roosevelt when the United States squeezed Japanese imperial ambitions in July 1940 with a trade embargo on aviation gasoline and scrap metal.

Second, the problem of increasing the value of their currency and the impact on the structure of the domestic economy something from which Japan never recovered after the Plaza Accord of 1985 that unleashed the yen.

The renminbi is back in the news.

Here we go again. After a brief hiatus over the summer, the Chinese currency saga is returning for its fall season.  http://www.ft.com/cms/s/0/716f8442-be86-11df-a755-00144feab49a.html?ftcamp=rss&ftcamp=crm/email/2010913/nbe/Comment/product

Although China's investment and trade with Canada is miniscule compared the United States it is highly concentrated in energy. The combination of Canadian openness and China's fear of being short raw materials makes investment in energy resources in Canada by Chinese state owned companies a natural.

The single biggest investment by a Chinese entity in a Canadian company was concluded on July 15 when China Investment Corporation (CIC) finalized its purchase of a $1.7-billion equity stake in Teck Resources of Vancouver.   http://www.eastasiaforum.org/2009/08/20/china-inc-comes-to-canada/

Related.

This July 2010 Canadian government published document reviewing Canada's trade and investment has all the data you need to understand the scale of Canada's official economic relationship with China. Pages 48 and 56 show the importance of energy in Canada's overall trade, pages 71 investment by country, and page 75 by type.

 

Killer Statistic -- a 0.1% increase in trade to BRIC countries by 2035 would value $29 billion.

 

http://www.international.gc.ca/economist-economiste/assets/pdfs/DFAIT_SoT_2009_en.pdf

 

Pdf below.

Related.

This paper traces the development of China's outward direct investment policies.  http://economics.ca/2006/papers/0892.pdf

Geoff Dywer has a very important article about China's relationship with Brazil, in after all America's backyard.

Deep in the Amazon jungle, huge chunks of red earth are torn out of the ground at Carajás, the biggest iron ore mine in the world, to be transported halfway round the globe to the steel mills on China’s eastern seaboard. There they are turned into the backbone for millions of tower blocks in hundreds of booming Chinese cities.  http://www.ft.com/cms/s/0/57f55ab0-be99-11df-a755-00144feab49a.html?ftcamp=crm/email/2010913/nbe/Analysis/product

The Economist's lead article this week is about the rise of Latin America. We ain't going to be pushed around anymore.

THIS year marks the 200th anniversary of the start of Latin America’s struggle for political independence against the Spanish crown.   http://www.economist.com/node/16990967

Another way to look at it.

And Asia-Pacific country data.

Use our interactive map to view main economic indicators of countries in the Asia-Pacific region, as well as case studies of prominent businesses and up-and-coming entrepreneurs in the region.  http://www.ft.com/cms/s/2/82bc2638-bc33-11df-8c02-00144feab49a.html

China's submarine.

When three Chinese scientists plunged to the bottom of the South China Sea in a tiny submarine early this summer, they did more than simply plant their nation’s flag on the dark seabed.  http://www.nytimes.com/2010/09/12/science/12deepsea.html?_r=3&nl=todaysheadlines&emc=globasasa21

Hot under the Japanese collar.

China’s leading foreign policy official raised the stakes in the latest diplomatic dispute with Japan on Sunday, warning Tokyo not to make “wrong judgments” over the seizure of a Chinese fishing boat in contested waters.  http://www.ft.com/cms/s/0/a0c4b852-be63-11df-a755-00144feab49a.html?ftcamp=rss

 

 

India's worry about China.

India must prepare to counter China's territorial ambitions in South Asia, Manmohan Singh, India's prime minister, has warned.  http://www.telegraph.co.uk/news/worldnews/asia/india/7987115/Indias-PM-says-Chinas-territorial-ambition-must-be-challenged.html

 

Related.

The Chinese government came under tremendous pressure ... http://timesofindia.indiatimes.com/world/china/Why-China-seized-India-maps-at-Shanghai-Expo/articleshow/6457769.cms

Russia and China try to avoid using the US dollar for trade.

China and Russia plan to start trading in each other’s currencies as the world’s second-biggest energy consumer and the largest energy supplier seek to diminish the dollar’s role in global trade.  http://www.businessweek.com/news/2010-09-08/china-russia-push-yuan-ruble-trading-to-diminish-dollar-role.html

 

Vietnam's worries.

Vietnam accused China on Thursday of violating its sovereignty by conducting seismic exploration near disputed islands in the South China Sea and urged Beijing to do more to promote peace, stability and healthy bilateral relations.  http://in.reuters.com/article/idINIndia-50656220100805

 

Michael Pettis on China's imbalances.

In all my meetings ... http://mpettis.com/2010/09/what-do-the-good-trade-numbers-tell-us/

China's unstable economy.

China is heading toward a Japanese-style economic debacle, says columnist John Lee, who warns that the process won't be as gradual or peaceful.  http://www.businessweek.com/globalbiz/content/aug2010/gb20100831_989060.htm

Finally, Aboriginal people have their issues with China too.

There is some concern among Tibetan solidarity activists that First Nations in Canada are being used to help China legitimize their ongoing campaign to extinguish the Tibetan People.  http://intercontinentalcry.org/china-is-manipulating-canadas-first-nations/