In 2008, I wrote an article for an international business consultancy newsletter that outlined the opportunities associated with Chinese investing abroad. In the article, I wrote that since China commenced opening up in 1979, most international capital flow has been into China rather than out of it.
By 2008, this capital flow had contributed to China accumulating domestic savings in excess of $1.7 trillion. The Chinese government subsequently decided that capital flow should be a two-way street and much of this $1.7 trillion would be headed abroad.
When hearing of the new policy, my immediate suspicion was that would also make it easier for corruptly acquired money to be laundered in foreign countries; however, I put my cynicism aside to simply stitch together the economic reasons that the consultancy gave in support of the government’s strategy.
According to the consultancy, the most pressing reason was to offset problems caused by
View original post 846 more words