…nor is the acrimonious debate about the exchange rate between the two currencies, or even the $45 billion in trade deals that the U.S. just signed with China. It’s China’s new pilot policy to allow foreign asset purchases in RMB. Chinese money is now available for buying into projects that we’ve shelved for decades while waiting for funding. This is bigger than currency manipulation and exports—this is investment in America, using money that China earned domestically, but mostly from abroad.
The rules are still being written for this recent trial—not only in terms of the logistics of purchases of foreign assets with the yuan, but in terms of how to structure the deals themselves—but it is undoubtedly the beginning of a seismic shift in investment trends between the East and the West. We are looking at a new global investment landscape for the next couple of decades.
Looking at the huge volume of cash in China that can be invested in U.S. projects, we anticipate strong potential to improve U.S. public infrastructure in exchange for land use development rights and tax incentives for job creation, among other negotiable incentives. These are the kinds of major collaborations that we’ve been hoping for and working toward.
Palisades is currently vetting projects from American public agencies as well as private enterprises. We’re happy to see Americans responding so positively to this new situation and are hopeful that these future collaborations will result in great success for the people in both countries.
Tags: currency manipulation, Hu Jintao, President Obama, trade, yuan purchases of US assets
