China is ever so slowly using its enormous economic power to expand its influence in east Asia.
(Bloomberg) -- China’s central bank said it’s in talks to sign more currency-swap agreements to bolster international trade, after sealing six such accords since November 2008.The People’s Bank of China has set up 650 billion yuan ($95 billion) worth of swaps to provide short-term liquidity, according to a statement today on its Web site. The central bank said the funding will promote bilateral trade and direct investment by allowing one country to pay for imports in another nation’s currency.
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The central bank has entered swap agreements with Indonesia, Malaysia, South Korea, Hong Kong, Belarus and Argentina, broadening access to the yuan, which isn’t freely convertible. They also underscore China’s efforts to expand the country’s economic reach in activities that don’t involve the U.S. dollar.People’s Bank of China Governor Zhou Xiaochuan last week called for the creation of a new global reserve currency, expressing concern shared by many developing countries about the value of the dollar. Malaysia and Indonesia are among countries that have expressed their support for Zhou’s call.
Not surprising
But what is so sad is the United States basically gave away our economy to China. The China PNTR (trade agreement) has been in effect less than a decade and China now has our manufacturing base, controls supply on a host of consumer goods and now literally controls our currency by holding U.S. debt.