Generational Dynamics World View News

Discussion of Web Log and Analysis topics from the Generational Dynamics web site.
John
Posts: 11478
Joined: Sat Sep 20, 2008 12:10 pm
Location: Cambridge, MA USA
Contact:

Re: Generational Dynamics World View News

Post by John »

** 10-Jun-2019 World View: Mongolia's economy expected to continue fast growth

Mongolia's GDP growth rate is being described by analysts as
"explosive," after reaching 6.9% growth in 2018, up from
5.1% GDP growth in 2017.

Exports now account for more than half of Mongolia’s GDP. The main
export commodities are copper, apparel, livestock, animal products,
cashmere, wool, hides, fluorspar, other nonferrous metals, coal and
crude oil.

It hasn't always been like that. Mongolia became an independent
democracy in 1991, with the collapse of the Soviet Union. Since then
it showed steady growth, mainly fueled by exports of coal and copper,
as well as by foreign direct investment.

In 2011, Mongolia's economy grew by an astronomical 17.5%, thanks to
its huge reserves of copper, coal and gold, making the economy seem
invincible. Instead of saving some of that money, Mongolia borrowed
billions of dollars more to invest in huge road and infrastructure
projects.

By 2014, deeply in debt, Mongolia's economy began to collapse because
of falling commodity prices, triggering reduced foreign investments
and reduced purchases by China. Mongolia's economy experienced a near
collapse in the 2014-2016 period, with GDP growth falling
to 1.2% in 2016.

After 2016, with the rise in commodity prices, all the factors were
reversed. Coal mining saw a 63.1% annual surge, due to growing coal
exports to China, which replaced North Korean coal with Mongolian coal
in 2017 as part of a sanctions response against North Korea's nuclear
testing activities. Mongolia has also been receiving support from a
number of sources, including the International Monetary Fund (IMF),
the World Bank, the Asian Development Bank and the International
Investment Bank.

With the growing economy, citizens became more affluent as well. The
sectors that attract most foreign investment are mining, oil and
construction. Other investment sectors include raw materials,
livestock, mining, food processing, telecommunications and tourism.


**** Reducing dependency on China and Russia

As a landlocked country, Mongolia is dependent on its big neighbors,
Russia and China. Mongolia imports almost all of its crude oil from
Russia. 90% of Mongolia's exports, particularly coal and copper, go
to China. Major Chinese companies operating in Mongolia include Bank
of China Ulan Bator Representative Office and Air China Mongolia.

The dependency on China is symbiotic to some extent. China is heavily
dependent on the import of commodities, and Mongolia is one of its
main suppliers. This dependency may be growing because of growing
tensions with Australia, which historically has been China's main
supplier of copper and coal.

China-Australia tensions have been growing over numerous issues,
including China's infiltration into Australia's government,
cybersecurity, and China's influence in the Pacific Island nations.
Because of the tensions, clearing times through China's customs have
doubled to more than 40 days. China has sharply reduced purchases of
Australian coal, and Mongolia has been the biggest beneficiary, with
coal exports rising 15% to 7.8 million metric tons in the first
quarter.

But the problem with being dependent on China is that China giveth,
and China taketh away, as in the Australia case. Another example is
South Korea in 2017, when China's government was enraged because South
Korea permitted deployment of the THAAD defensive missile system, to
protect itself from North Korean missiles. China retaliated by
banning South Korean goods for sale in China, South Korean pop stars
and entertainers, and packaged tours, cruise tours and charter flights
to Korea.

Mongolia was also targeted by China's petty retaliation. In 2016,
Mongolia's economy was in crisis because of huge debts incurred from
borrowing money for infrastructure projects. Mongolia requested a
large loan from China to get through the crisis. But in November of
that year, the Buddhist leader the Dalai Lama visited Mongolia's
capital city Ulaanbaatar in November for a six-day visit. More than
half of Mongolia's population are Buddhist, and tens of thousands of
them flocked to see the Dalai Lama, with some traveling hundreds of
miles.

China does not like the Dalai Lama, as he is worshipped by millions
of Buddhists in Tibet, where China is violently cracking down on
Buddhist worshippers. So China punished Mongolia by blocking the loan
and by closing part of the border, leaving hundreds of trucks carrying
copper and coal backed up on the highway in sub-zero temperatures.
Mongolian officials were forced to apologize, and promised never,
never, never to invite the Dalai Lama again.

So in the last few years, China has used massive economic retaliation
against Australia, South Korea and Mongolia, and has threatened many
other countries and organizations with economic retaliation unless
they sided with China on the Taiwan question. In view of China's
policies of using this kind of retaliation for something as simple as
inviting a Buddhist leader to visit, it's pretty obvious why Mongolia
would like to reduce its dependency on China.

Furthermore, there is centuries-old history that makes ordinary people
in Mongolia suspicious of China's motives. Anti-Chinese sentiment has
been mobilized by politicians as part of a wider nationalist
narrative.

In order to reduce its dependency on China, Mongolia in the last year
has been taking steps to improve the country's legal framework in
order to encourage foreign investment from other countries. The steps
taken include:

* Remove regulations and restrictions that make it difficult for
foreign investors to do business in Mongolia.

* lift the moratorium on new mining exploration licenses

* find ways to maximize foreign investment in natural resources, by
providing related goods and services that go beyond mining. An
example is coal washing.

* reach out to Japan, South Korea, US and Australia for investors

* at the same time, diversify to attract foreign investment in
other, non-mineral activities. Some targets include tourism and
hospitality, e-commerce, and agribusiness.

*** Investment sectors -- mining, real estate, retail, tourism

Mongolia has a relatively young population, with about 42% under the
age of 24. A quarter of the population is under the age of 14. The
Mongolian people are well educated, with a literacy rate of 97%, one
of the highest in the world. Mongolia is a huge land, containing an
estimated $1.5-2 trillion in minerals. These basic facts mean that in
the long run, Mongolia is an excellent target for foreign investment,
with a great deal of profit potential in the next decade.

With plenty of land, the real estate sector has been booming, though
not for speculation purposes. The country has only three million
people, but is three times the size of France, which has 67 million
people. So speculative real estate investments are not likely to pay
off.

But with Mongols having more disposable income than they've had in the
recent past, the real estate boom is being led by the retail sector,
with shopping centers displaying many luxury brands like Versace
Collection and Burberry. Investment opportunities in the retail
segment include expansion of the smartphone market and digital
communications, and financial services. Emerging companies such as
LendMN and Ard Financial Service use AI-based sophisticated technology
to build fast growing applications in solvable markets.

More than 100 international brands have opened up exclusive franchises
or wholly owned outlets in Ulaanbaatar to date. At the same time,
there is still a need for brands targeted at mass market consumers to
cater to the growing local appetite for conspicuous consumption.

However, pollution is a major problem for Ulaanbaatar. Many people
burn coal and plastic just to survive temperatures as low as minus 40
degrees. Ulaanbaatar is one of the most polluted cities on the
planet, alongside New Delhi, Dhaka, Kabul, and Beijing.

Besides the danger of retaliation from China, potential investors
should keep watch for one more development: Under the guise of
fighting corruption, Mongolia's President Khaltmaa Battulga has pushed
through the parliament a law that gives him control of the courts,
including the ability to assign or remove judges, or to reassign
cases. This could mean that commercial disputes will be decided
politically, rather than by democratic institutions.

---- Sources:


-- Mongolia coal exports surge 15 pct in Q1 after China Australia ban
https://www.reuters.com/article/mongoli ... SL3N21X1QX
(Reuters, 15-Apr-2019)

-- Doing business in Mongolia: Mongolia trade and export guide
https://www.gov.uk/government/publicati ... o-mongolia
(UK Government, 8-Feb-2018)

-- Moody's upgrade brings FDI optimism for Mongolia
https://www.fdiintelligence.com/News/Mo ... r-Mongolia
(FDI Intelligence, 22-Feb-2018)

-- Mongolia: Foreign investment
https://en.portal.santandertrade.com/es ... nvesting-3
(Santander Trade, Sept 2018)

-- FDI / The World Bank in Mongolia
https://www.worldbank.org/en/country/mongolia/overview
(World Bank, 28-Sep-2018)

-- Investment Reform Map for Mongolia
https://www.ifc.org/wps/wcm/connect/f2a ... OD=AJPERES
(World Bank / IFC, June 2018)

-- China and Japan’s Investment Competition in Mongolia
https://thediplomat.com/2018/08/china-a ... -mongolia/
(Diplomat, 1-Aug-2018)

-- Tapping into hidden potentials and new opportunities in Mongolia
https://blog.mongolia-properties.com/hi ... n-mongolia
(Mongolia Properties, 11-Feb-2019)

-- Big names are moving into Mongolia
https://blog.mongolia-properties.com/bi ... cial-space
(Mongolia Properties, 7-Jan-2019)

-- Mongolia’s GDP growth at 6.9% in 2018, official data shows
https://www.bne.eu/mongolia-s-gdp-growt ... ws-156555/
(Business New Europe, 19-Apr-2019)

-- Toxic air tears apart families in Mongolia
https://phys.org/news/2019-03-toxic-air ... lia_1.html
(AFP, 31-Mar-2019)

-- Battulga Khaltmaa / Genghis Khan's Biggest Fan Is Testing
Mongolia's Democracy
https://www.bloomberg.com/news/features ... -democracy
(Bloomberg, 16-Apr-2019)

-- Khaltmaagiin Battulga / Mongolia’s President Is Slicing Away Its
Hard-Won Democracy
https://foreignpolicy.com/2019/03/29/mo ... democracy/
(ForeignPolicy, 29-Mar-2019)

John
Posts: 11478
Joined: Sat Sep 20, 2008 12:10 pm
Location: Cambridge, MA USA
Contact:

Re: Generational Dynamics World View News

Post by John »

** 11-Jun-2019 Hong Kong
Guest wrote: > Yes, exactly. I fully expect the Chinese communist military to
> attack any day now. There is a concrete yellow army barracks in
> the middle of Hong Kong. I've seen it, but I have never seen any
> Chinese soldiers in Hong Kong. The Chinese don't have to invade
> the city; the soldiers are already there. They are invisible now,
> but they are there.
I don't understand this. You say that the soldiers are already there
in the concrete yellow army barracks, but you've never seen them. Are
you saying that they're hiding away in this barracks building, but
they never come out, but they're just staying in there playing Chinese
Checkers with each other until they're given the order to come out and
attack?

Guest wrote: > Yes, oceans of human blood will pour out of Hong Kong soon; along
> with billions in cash and the complete implosion of Hong Kong's
> economy. That will lead to the near collapse of mainland China's
> economy. I have a lot of experience in Asian countries; this is
> how it will pan out.
You make an important point when you link Hong Kong's economy
to the mainland.

The CCP has always cynically made use of Hong Kong, starting in the
1930s while it was still a British colony. The CCP uses deception and
goes through Hong Kong when it seeks foreign investment, or to
influence the Chinese diaspora. A lot of people in the West don't
want to deal with the CCP thugs, but they may be willing to deal with
happy, carefree Hong Kong.

So if the CCP makes a bloody attack on Hong Kong, or even just clamps
down to the extent that Hong Kong is indistinguishable from Beijing,
then the CCP will have lost a very important tool of deception. This
will inhibit them to some extent.

John
Posts: 11478
Joined: Sat Sep 20, 2008 12:10 pm
Location: Cambridge, MA USA
Contact:

Re: Generational Dynamics World View News

Post by John »

** 11-Jun-2019 Escape from Korea
Guest wrote: > I bought a copy of your China book. Thank you for your hard work,
> John.
Thanks! Tell all your friends.
Guest wrote: > Still hoping to escape Korea in July.
Good luck!

Guest

Re: Generational Dynamics World View News

Post by Guest »

but they never come out, but they're just staying in there playing Chinese
Checkers with each other until they're given the order to come out and
attack?
Exactly, the Chinese soldiers are not allowed outside. They never interact with the locals. The soldiers official HQ is a skyscraper like building, but the barracks are elsewhere. Thousands of soldiers are stationed there but you never see them. Ever. But they are armed to the teeth.

And ready to attack.

John
Posts: 11478
Joined: Sat Sep 20, 2008 12:10 pm
Location: Cambridge, MA USA
Contact:

Re: Generational Dynamics World View News

Post by John »

** 11-Jun-2019 Hong Kong

> but they never come out, but they're just staying in there playing
> Chinese Checkers with each other until they're given the order to
> come out and attack?
Guest wrote:
> Exactly, the Chinese soldiers are not allowed outside. They never
> interact with the locals. The soldiers official HQ is a skyscraper
> like building, but the barracks are elsewhere. Thousands of
> soldiers are stationed there but you never see them. Ever. But
> they are armed to the teeth.

> And ready to attack.
How do you know that if you can't see them?

Guest

Re: Generational Dynamics World View News

Post by Guest »

John wrote:** 11-Jun-2019 Hong Kong

> but they never come out, but they're just staying in there playing
> Chinese Checkers with each other until they're given the order to
> come out and attack?
Guest wrote:
> Exactly, the Chinese soldiers are not allowed outside. They never
> interact with the locals. The soldiers official HQ is a skyscraper
> like building, but the barracks are elsewhere. Thousands of
> soldiers are stationed there but you never see them. Ever. But
> they are armed to the teeth.

> And ready to attack.
How do you know that if you can't see them?
Everyone knows they are there. Beijing lets it be known in subtle and not so subtle ways.

FishbellykanakaDude
Posts: 1313
Joined: Tue Jan 09, 2018 8:07 pm

Re: Generational Dynamics World View News

Post by FishbellykanakaDude »

Latcho Drom
("Safe Journey", as plea.)

Music, faces, dance, song, someone else's countryside..

..chasing the sun. Roma.

The sound and invisible tears of pain and family.

Image


John
Posts: 11478
Joined: Sat Sep 20, 2008 12:10 pm
Location: Cambridge, MA USA
Contact:

Re: Generational Dynamics World View News

Post by John »

** 12-Jun-2019 World View: Will China screw up Hong Kong?


I've written in the past that the Chinese Communist Party (CCP)
cynically makes use of Hong Kong for foreign investment and diplomacy
with people who don't want to deal with the thugs in the CCP,
but can instead deal with China through happy, carefree Hong Kong.

Anti-Beijing protests were renewed on Wednesday, though much smaller
than the million-man protests on Sunday. They are protesting a
proposed new extradition law that will make it legal for Chinese
security forces to abduct anyone in Hong Kong and bring him back to
Beijing for trial.

Wednesday's protests provoked a great deal of violence by Hong Kong
police, who used rubber bullets, water cannons and tear gas to force
the peaceful protesters to disperse.

I heard a pro-Beijing analyst on the BBC this morning say that the
extradition law is perfectly OK. He said:
"Why should Beijing screw up Hong Kong? You tell me.
Because if Hong Kong is just like Shanghai, it will be utterly
useless to Beijing."
To me, this is a very weird insight into the mindset of
the pro-Beijing view. No concern about human rights, freedom
of speech, or freedom of assembly in Hong Kong. The only concern
is whether Hong Kong is useful or useless to Beijing.

The CCP sees any large public pro-democracy protest as an existential
threat to the CCP, in the same way that pro-democracy protests in
Moscow brought about the collapse of Soviet communism.
The CCP would like to send in the army and turn Hong Kong into
a lake of blood, as it did in the 1989 Tiananmen Square massacre.
However, it can't do that -- not because it's bad for human rights,
but because Hong Kong would then be "useless" to Beijing.

Hong Kong's "usefulness" to Beijing depends on
on the "one country two systems" agreement
under which Britain turned it's Hong Kong colony over to
China in 1997. An important part of that
agreement is that Hong Kong and China have separate legal
systems, with separate laws and separate processes. The
proposed extradition agreement begins to merge the two legal
systems.

International investors like to deal with Hong Kong rather than with
the thugs in Beijing because Hong Kong is very friendly to business
and finance, and that's how the CCP "uses" Hong Kong. If the
perception grows that Hong Kong is no longer friendly to business and
finance, and that anyone visiting Hong Kong can be abducted to
Beijing, then it will be just like Shanghai, and will be "useless" to
Beijing. What a country.

---- Sources:


-- Hong Kong Police Fire Tear Gas
https://www.dtnpf.com/agriculture/web/A ... e-tear-gas
(AP, 12-Jun-2019)

-- Hong Kong extradition bill: thousands of protesters block city
streets and prepare for worst as riot police gather nearby
https://www.scmp.com/news/hong-kong/pol ... ters-start
(South China Morning Post, Hong Kong, 12-Jun-2019)


-- Hong Kong Markets Roiled by Interbank Rate Squeeze Amid Protests
https://www.bloomberg.com/news/articles ... lock-roads
(Bloomberg, 11-Jun-2019)

John
Posts: 11478
Joined: Sat Sep 20, 2008 12:10 pm
Location: Cambridge, MA USA
Contact:

Re: Generational Dynamics World View News

Post by John »

** 12-Jun-2019 World View: Xi Jinping's problems with Hong Kong

According to China analyst Gordon Chang on Fox Business Network this
morning:
  • Hong Kong is Xi Jinping's portfolio, so hardliners in Beijing are
    blaming him for the problems in Hong Kong
  • Xi is also being blamed for the failure so far of the US-China
    trade negotiations
  • So Xi has two crises on his hands, just before the G20 talks.
    This weakens Xi at a time when there are hardliners in Beijing just
    waiting for Xi to fail so that they can take over.
  • Xi has never failed to take the most violent hardline approach.
    However, creating a bloodbath in Hong Kong would make Hong Kong
    "useless," for the reasons I gave in the previous posting.
  • Many businesses have headquarters and regional offices in Hong
    Kong. If the CCP becomes violent in Hong Kong, or starts abducting
    tourists and executives off the streets and sending them back to
    Beijing, then these businesses will move their headquarters back to
    New York, and regional offices to Singapore, Tokyo, or Taipei.
  • There is a garrison of Chinese army soldiers in Hong Kong.
    They've been there since 1997, but they're remained in their barracks.
    Xi Jinping could bring them out to violently bring Hong Kong under
    Beijing's control.
Hong Kong's legislature was forced to delay its discussion of the
extradiction law, which was very publicly scheduled for Wednesday at
noon. But the protesters blocked access to the legislature building,
and the delay is being chalked up as a major victory for the
pro-democracy protesters. This will both embolden the protesters and
infuriate the CCP, which means that the next confrontation could be a
lot bloodier.

Post Reply

Who is online

Users browsing this forum: No registered users and 52 guests