Beijing acknowledges that a break-up of the euro zone would be a disaster, but the price on a Chinese-backed rescue may be higher than what Brussels is willing to pay. Around the recent Understanding China Policy Summit, Chinese officials said the money is there to bail out European Union's debt. Money is not a problem, given China's $3.2 trillion in currency reserves. The problem, they say, is that simply issuing new bonds is not the answer. Foreign ministry counsellor Hua Chunying reportedly says Europe -- China's largest trading partner -- is suffering a crisis of "confidence." Once the continent summons the political will to reform its society, she says, a solution could be "very rapid." Senor economic researcher Wang Yiming was even more clear: "The European economy needs blood, but not asking us to buy their bonds, we need to create new blood, by promoting investment."
Wang objects to what he sees as "a lot of discussion about what we should do with our $3.2 trillion." He wants to see Europe open up to Chinese investment, effectively giving Beijing access to infrastructure projects that previously remained the reserve of various European nations. This is not only to support European demand for Chinese products, but to share technology to continue the task of modernizing Asia. As he puts it, Brussels roads may be congested, "but it's still better than what we have in China." So far, European officials have rebuffed the overture, noting that Beijing's investments usually come with political strings attached.
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