Not dollar, not euro, but gold

As the US dollar’s value continues to drop, China looks to invest in gold for stability.

Growing concerns about the slow death of the dollar rather than a saviour’s goodwill are underpinning China’s widely publicised purchases of European government debt, according to experts. But as the Eurozone debt crisis spreads from Greece and Portugal to countries like Italy and threatens the very survival of the euro, China’s finance mandarins and keepers of the country’s 3 trillion dollars foreign reserves are looking yet again at gold as the anchor of stability.

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Yu Yongding, a former adviser to the Central Bank of China and strong critic of US treasury bonds, an asset in which about 1.2 trillion dollars of China’s foreign reserves are invested, has been calling on Chinese rulers to diversify as much as possible of China’s holdings to guard against a weaker dollar.  Continue reading

Explore Opportunities With China In Islamic Finance For JVs In Capital Market, Malaysian Investors Told

Islamic finance could possibly be the first area to kick-start a joint venture between Malaysian and Chinese capital market intermediaries, says Deputy Finance Minister Datuk Ir Donald Lim Siang Chai.
He said Islamic finance was Malaysia’s key strength and represented a very attractive market segment for the local intermediaries to bring to China.

Explore Opportunities With China In Islamic Finance For JVs In Capital Market, Malaysian Investors Told

Explore Opportunities With China In Islamic Finance For JVs In Capital Market, Malaysian Investors Told

“In this regard, I strongly urge Malaysian intermediaries to explore any joint-venture opportunity with Chinese intermediaries,” he said in his keynote address at the conclusion of the 15th Malaysian Capital Market Summit here Thursday.

In his address, entitled “Attracting Chinese Portfolio Investment and Funds to Malaysia”, Lim stressed that such joint ventures could create greater capital market flows between both countries.

He said the leading market intermediaries in the segment would be able to play a large role in growing Islamic finance in China.

“This can be done by sharing the experience, knowledge and expertise with relevant Chinese players to build their investment appetite for the asset class,” he said.

In September last year, China awarded the first Islamic Banking licence to Bank of Ningxia, marking its venture into Islamic market products to provide a new asset class to its investors.

Meanwhile, bilateral trade between Malaysia and China in the last decade has grown rapidly, registering an average growth rate of 25 per cent annually.

Lim said the improving economic conditions after the global financial crisis and the China-ASEAN Free Trade Agreement, Malaysia has overtaken Singapore as China’s number one trading partner in South East Asia.

China has also become Malaysia’s largest trading partner.

The 15th Malaysian Capital Summit is an annual event organised by the Asian Strategy and Leadership Institute.

The event was supported by the Securities Commission of Malaysia, Bursa Malaysia and other government and non-government associations.