The strategy of
’s ruling Communist
Party has been clear for years. In order
to feed China China’s
huge and growing demand for raw materials, the country is going around the
world and buying up resources and companies that control those raw
materials. China has learned something it took
the West centuries to learn. It is more
effective and less expensive to buy rather than conquer.
The latest Chinese acquisition is Canadian oil giant Nexen, which China will purchase, regulatory approval pending, for about $15 billion.
The deal, if completed, would be
largest overseas acquisition of a listed company, and comes at a time when
Chinese companies are increasingly scouring the world for deals during the
global downturn. China
But this is more than just a purchase of an energy company. With the purchase
will be establish a huge North American management infrastructure.
Under the terms of the latest deal, Nexen management will become the new face of Cnooc in North America, with an expanded mandate that will cover Cnooc’s assets in the US, Canada and Caribbean.
Cnooc will make
Calgary its North American
headquarters and the Hong-Kong listed company will list shares on the stock exchange. Toronto
So America, just keep buying all that Chinese stuff, and keep shipping all those dollars to China and keep borrowing all those dollars back so we can have budget deficits with low taxes. And then plan to sell of the nation’s commercial crown jewels to pay for everything.
Sounds like a plan, doesn’t it.