That’s the implicit message in a new article published in Germany’s Der Spiegel. Looking at the dynamics behind China General Secretary Hu Jintao’s visit to Europe, the author is blunt (and accurate):
“China is seizing on Europe’s debt problems to expand its influence on the continent with large-scale investments and purchases of government bonds issued by highly-indebted states. The strategy could push Europe into the same financial dependency on China that is posing a dilemma for the US.”
The Chinese government is being very shrewd in how it handles the Europeans, directing its attention and support to those that are most vulnerable and in the most need of economic support. There has been a shift in their strategic approach to the world. They are buying more non-dollar bonds with their reserves and are linking these purchases of debt with their geopolitical goals. More:
“Indeed, the rising superpower is cleverly capitalizing on the euro crisis to extend its long-term political and economic influence in Europe. Chinese offers of aid are mainly directed at the shakiest members of the euro zone, the heavily indebted so-called PIIGS countries (Portugal, Ireland, Italy, Greece and Spain). The People’s Republic would like to win them over as long-term allies in the EU.
In the past, China had shown itself to be a ‘friend’ of Greece, Spain and Italy, and it purchased their government bonds at a time when other investors had fled, Premier Wen Jiabao said during a trip to Europe in October. ‘We will continue to provide aid and help certain countries overcome their difficulties.'”
The troubled Euro leaders are clearly sucking up to the Chinese. Italian Prime Minister Silvio Berlusconi had the Roman Colosseum bathed in red light when Chinese leaders visited and ordered Chinese characters projected onto the structure.
So long as America itself is mired in debt, our international prestige will continue to sink. Our influence in Asia has been on the decline, and Russia is increasingly linking its economic fortunes with the Chinese. President Obama’s global strategy is based on the notion that if people “like us” our interests will be protected. The Chinese have a better grip on reality: it’s better to be respected than liked.