China Gives Up On Europe, Will Target Africa Instead

Tyler Durden's picture

That China has finally given up on Europe is no news (granted, however, it will make it more complicated for various European newspaper to make up articles alleging China will bail out Europe now that this is no longer the case): after all even the Norwegian sovereign wealth fund has finally learned its lesson, and having been burned enough times, has made it quite clear it will have nothing to do with Europe's insolvent periphery. China, which has already lost enough money on Europe, has now decided to do the same. From Bloomberg: "China Investment Corp. has stopped buying European government debt because of an economic crisis on the continent, though it continues to look for new investments there, said CIC President Gao Xiqing. “What is happening in Europe right now is of course of concern,” Gao said yesterday in an interview in Addis Ababa, Ethiopia, during the World Economic Forum on Africa. “We still have our people looking at opportunities in Europe, even though we don’t want to buy any government bonds.” Sorry Europe: you had your chance. As for where China will invest its capital in the future? Why the one continent so far untouched by globalization, and which has the most debt capacity of all...

Yes, Africa:

The Chinese sovereign wealth fund would “love” to boost investments in Africa, Gao said. The company is limited in how much it can invest in Africa because the projects are not large enough to fit its investment criteria, he said.


The fund is boosting investments outside of China as it seeks to increase returns on the nation’s foreign currency reserves and secure commodity supplies. The Chinese government injected about $50 billion this year in the sovereign wealth fund, Gao said. The government has not made a decision on whether to regularly inject capital into the company, he said.


“Right now, we are busy enough, so we don’t worry terribly about recapitalization,” he said. “In the long run, we should do something about it.”

And where the big money is heading, Goldman can't be far behind. Sure enough, as recently as a month ago, the firm released the following 32 page mangum opus setting the stage for the Second Congress of Berlin:

In the early 1990s, few European or American companies would have been quizzed on their strategies for China or Asia. Now it's often the first item on the agenda. Our investigation in this edition is into Africa, and it might provoke déjà vu: is now the time for multi-nationals to be investing in Africa? In short, our conclusion is yes. Africa's exceptionally robust growth over the last decade is probably understated (informal parts of economies are very big), but not being able to measure this growth precisely shouldn't detract from Africa?s potential, which is about much more than resources as it evolves and climbs the consumption, urbanisation and perhaps industrialisation curves that the BRICs have climbed. We believe meaningful opportunities for western consumer companies exist as Africa?s household consumption grow s rapidly (it is already greater than some of the BRICs) and that failure to invest now will see others rush in. Capital flows and trade flows into Africa are a microcosm of the changing world, with the BRICs already there, notably in commodities. We have interviews with investors and Standard Bank and Tiger Brands that paint a picture of rapid and misunderstood change, and pieces from our consumer staples, mining and insurance analysts that reinforce this

Now all that remains is for Jim O'Neill to replace BRICS with SCRAMBLE (Sudan, Congo, Rwanda, Algeria, Mali, Botswana, Libya and Ethiopia) and the next great resource grab arena will be all too clear.

Because make no mistake: this is all about resources. Europe has none left, nor does it have any assets anymore. Which means it is time for a new playground, lots of new debt and debt slaves, and in 20 years: another continent stripped of everything valuable but at least with 200% debt/GDP as far as the eye can see..

Full must read report on Africa from Goldman Sachs:


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Jason T's picture

one of my Chinese stocks holdings, when I met with the CFO and CEO and asked about them exporting their products they said S. Africa was  a market they were testing out and looking to export to.  

The West is done for.  Hopeless debt basket case.

maxmad's picture

Dollar is officially no longer the World's Reserve Currency!  It is Charmin!

redpill's picture

Where is Wadiya on that map??

Aziz's picture

Wadiya is Washington D.C.

MillionDollarBonus_'s picture

Anti-inflation libertarians often criticize President Robert Gabriel Mugabe for his expansive fiscal policy and the Zimbabwean Central Bank's generous monetary policy. But the fact is, Zimbabwe has gone through a painful but necessary transition to a more equal society. As an avid marxist, President Mugabe understood the need for a more equal Zimbabwe, where the greedy and racist farmers and white industrialists gave a fair share of their property to the state. Now that the painful transition is over, this country is beginning to thrive, much to the dismay of whiny libertarians and doomer Austrians.

battle axe's picture

OK MDB, you have  gone  from funny to just plain nutty......

Freddie's picture

Mugabe's doppleganger is in the White Hut.  Plenty of dicks posting here voted for him.

China's "investment" in Africa is to loot and plunder natural resources and labor.  The Africans will learn.  The westerners were slightly better.  The stupid west imported third world illegals and "asylum seekers" and have lost their countries do to the threat of racism.  The stigma of racism did more to destroy the west than 20 panzer divisions.


Joseph Jones's picture

Would you be so kind as to more thoroughly clarify your last two sentences?  Thanks.   

AnAnonymous's picture

Made me laugh.

Learn what? They have already gone through the clutches of US citizens. They know by now.

Imported third world illegals? A large number of them were imported legally.

And second, human beings follow the resources. As one transports resources from A to B, people follow.

It is been that way for millenia now.

And the chinese really need to up their game to match the slightly better achieved by US citizens. Once again, they are laggin behind, and one could wonder if they are able to achieve US citizen status...

TheFourthStooge-ing's picture

AnAnonymous said:

And the chinese really need to up their game to match the slightly better achieved by US citizens.

Thus the testing grounds of Tibet, Mongolia, and Nepal for Chinese citizenism citizens to practice imposing slavery. This is rehearsal for Chinese citizenism blobbing up in Africa.

Once again, they are laggin behind, and one could wonder if they are able to achieve US citizen status...

Perhaps more weirdo ideas like life extension capsules filled with dried, powdered remains of human babies and fetuses will catch up Chinese citizenism to surpass US citizen status.

In Chinese citizenism, baby powder means powdered baby.


battle axe's picture

OK MDB, you have  gone  from funny to just plain nutty......

Elwood P Suggins's picture

How much do you have invested there?

marathonman's picture

This is one of the most ridiculous comments I've read on ZeroHedge and I've seen some doozies.  Right, all we need to do is to take the land of the white guys, give it to the thugs and cronies of the murderer in charge, let the people starve from lack of food, and hyperinflate the currency because the policies were such an economic disaster.  Sounds like great policy MDB.  You enjoy BHO - he is the American Mugabe.  We'll see how popular the program is here.

Sanksion's picture

MDB is a marvel for spotting guys not able to smell an irony as large as Texas.

reTARD's picture

MDB's super hero power is sarcasm. +1 to Captain Sarcasm!

MeelionDollerBogus's picture

Now all the serfs of Zimbabwe trade 0.1 grams of gold for a loaf of bread.

That's all equal now.

That's what you meant, right MDB? Back to the gold standard?

Silver Bug's picture

China needs to stop throwing good money after bad. Avoid the west, invest in gold and silver. They are.

narnia's picture

They are full board into Africa trying to get something / anything before the music stops for the bankrupt promises they are holding.

Sudden Debt's picture

Get real... The only people in Africa which I trust with my money is that Nigerian prince who's dying of cancer and who promised me to give me all his money when he dies.


maxmad's picture

Are you referring to or President?

Popo's picture

Heh.  Small world!  I know the same guy, and because I helped him out he promised me all of his  ... oh shit...

Dr. Engali's picture

LOL .....did you happen to give him your account information so he can wire you a small installment?

smlbizman's picture

did anyone see steve rattner the x car czar this morn on cnbs....planting the seeds for the furture when he was saying the sheep are just to stupid to understand investing in individual stocks...."how can a doctor in kansas city know anything about exxon to invest in them" ...i am sure the only qualified people smart enough to do this is the say goodbye to ur ira and ur 401 k ....

Dr. Engali's picture

It's coming. They have put out a couple trial balloons already.

tempo's picture

The US is the leader in promoting Gay rights, uncontrolable spending/deficits, and mini wars. Lets talk about more gay rights. That will surely create good paying jobs.

Joseph Jones's picture

NPR must do several dozen "news" articles per day promoting homosexuality.

Another NPR "news" favorite is"Women's rights" in the Arab/Muslim world.  Yeah, let's start a couple wars and spend a couple Trillion dollars to promote women's rights in Islam.  Excellent idea! 

jekyll island's picture

Take a look at what Africa Oil Co. stock has done over the last month. 

Gully Foyle's picture

This is very old news. China has been pumping money into Africa and South America for a very long time.

Meanwhile we have been invading third world nations and receiving nothing in return, except bases.

toady's picture

...then our troops leave and turn the trillion dollar bases over to the locals. Now that is ROI!

But back to China / Africa. This is yet another example of of completely inept foreign policy. No one has sold American exceptionalism since Nixon. Reagan sold it to US citizens, but put off the rest of the world when he did. US dominance has fallen ever since, especially in Africa.

AnAnonymous's picture

Meanwhile we have been invading third world nations and receiving nothing in return, except bases.


That is a fair point.

The reason is obvious. US citizens had already performed the theft.

It is the current issue for US citizens, they have been so successful in robbing they own it all by now.

They no longer invade countries to add inputs to their economy but to avoid the inputs are withdrawn from them.

They no longer add new suplly lines to their territory, they have to invest to securize and maintain their supply lines. A well known issue experienced by any expansionist nation.

The Chinese, on the opposite, adds to their inputs pool. And funnily enough, they do it through trade and diplomacy.

TheFourthStooge-ing's picture

AnAnonymous said:

The Chinese, on the opposite, adds to their inputs pool. And funnily enough, they do it through trade and diplomacy.

Made me laugh. Just ridiculous propaganda spreadery of Chinese citizenism.

Observe judiciously the Chinese citizenism trade and diplomacy fruitful now in Tibet, Mongolia, and Nepal. Under firmly examination one understanding receives the official stamp of Chinese citizenism being slavery trade and gunboat diplomacy most heartfelt.

Ah, but Chinese citizenism escapes self indiction by pushing responsibility to exterior onto US citizenism fantasy.

Buy hey, Chinese citizenism will always justify or deny, this is known best.


StychoKiller's picture

Man, you got that mangled English patter down pat! :>D

Ar-Pharazôn's picture

i thought that Iraq is plenty of oil and Afghanistan of rare earth elements..................... but if you say so..............................................

walküre's picture


Africa is NOT a basket case? What are you smoking?

The common shit huts don't have any plug ins for toasters or other appliances.

Roads? What roads?

The Chinese need to export their crap somewhere. Debt has been GRAND for them. Now we have the debt and the stupidly high marked-up CRAP from China and they have our currencies. Now they're exploiting Africa for the resources. But who is going to buy the CRAP?

laomei's picture

Easy.  Make massive investments in infrastructure and improve the economies.  Then take over the economies.


The key to this of course is to do it with no strings attached, no bullshit politics behind it.  China is creating a new market for itself and the US and Europe will be left in the dust.  There's also pretty much nothing you can do to stop it.

GetZeeGold's picture



Lots of gold in Africa. What took them so long?


Also on the plus side lemonade stands are still legal about massive potential for growth.


Popo's picture

Yes, but has anyone else noticed that the world is running out of emerging markets?

What exactly happens when there's no one left to exploit?    


fuu's picture

We will just have to make some markets emerge from the rubble created by the bombs and missiles.

EscapeKey's picture

Then Krugman and his fellow aliens land on planet Earth.

tabasco71's picture

That's referenced in the Bible is it not...  the second coming or something?

I Am Not a Copper Top's picture

They move on to the next planet.  Ever see "They Live?"

Gully Foyle's picture


"What exactly happens when there's no one left to exploit?"


Joseph Jones's picture

David Letterman pays good money for such quip! 

battle axe's picture

China wants those natural resources in Africa. Now if only US Banks would stay out of the European Hurricane, wouldn't that be nice....

xela2200's picture

Acceptance is the first step in recognizing when one is wrong. Now, they are ready to accept the loss on US treasuries and move on.

dereksatkinson's picture

China has been investing in Africa for a while now.  They build an entire state of the art city in Mauritius called "cyber city".  They have been buying chunks of mining companies and then using their ownership in those companies as a bargaining chip to get these companies to sell gold directly to them.  The way they are going about getting out of their dollar exposure is brilliant.

xela2200's picture

Also, They have been investing in Latin America. Big wake up moment was the expansion of the china town in San Jose Costa Rica.

ParkAveFlasher's picture

Hearing similar stories out of Ecuador and Peru as well, from locals themselves.