China’s President Hu Jinbao on official visit in Denmark before G-20
Continued from part one... Q1 hedge fund letters, conference, scoops etc Abrams and his team want to understand the fundamental economics of every opportunity because, "It is easy to tell what has been, and it is easy to tell what is today, but the biggest deal for the investor is to . . . SORRY! Read More
State visits are state visits; but the question is why? And now? It is the first state visit from China in Denmark – ever?
There were trade orders, but none of them revolutionary. The amount was about 4 bio. USD. The major agreements were:
A.P. Møller-Mærsk deal with Ningbo Port Group.
Carlsberg and the Yunnan province – a new brewery.
Otherwise food, fodder and “environment”. Nothing earth shattering (unfortunate turn of phrase in Japan) to illustrate: Danish Crown and Shineway 2800 tons of pork – the equivalent of about 30.000 pigs or .1% of annual Danish pork production – hardly a snack for a reception. The importance is the symbol.
The President had a cup of coffee on board the royal yacht – anchored conveniently in the city center – conversation should have eased by the Prince Consort that actually talks mandarin. I was a bit disappointed that the Crown Prince didn’t jump in (he is a Navy SEAL) – in the harbor – it would have given food for thought: Try that in Shanghai! – not recommended. “Environment” is a rather hyped subject generally; but could do with greater attention in China.
From President Hu Jinbao’s speech there was the traditional yada, yada, yada; but one thing stuck out – if only to confirm some of the analysis regular readers of ValueWalk have been burdened with:
In the next 5 year plan China is opening up to imports.
So it wasn’t the cultural exchange nor the business deals – and hardly the royal banquet with wine furnished by the Prince Consort’s chateau in Cahors (never liked the Malbec grape myself) – years ago we actually bought 2 bottles of the Cahors wine – the other was used for a coq-au-vin (gave a severe reprimand from the Society for Prevention of Cruelty to Animals).
No we must look elsewhere for an explanation of the unusual expression of friendship – I know China is unpopular; but when you go out of your way to visit a tin-pot nation like Denmark? I mean – few are that hard up for company?
Maybe we should go back some years to the Clinton administration: Denmark thumbed the Chinese “human rights” issue – officially supported by the USA as China made some rather mean reprisals on the trade front. The matter simmered down as it should, but Denmark got a “partnership” with China – which means that Denmark is one of the few countries that can bring up human rights issues with China without causing a major diplomatic flap.
The situation in Tibet is really getting out of hand – and it could be a way to get in contact with the Tibetans to see if a solution could be worked out.
The other main issue is the North Atlantic where the official explanation is the minerals on Greenland; but I have seen some survey reports. The rare earths are there; but the mining costs of such low grade ore are vast.
So it is more probable China is puzzled about the US Navy plan to switch the 50-50 balance between the Atlantic and the Pacific to a 40-60 distribution. But then again – that is speculation.