Of the many grandiose construction projects underway in China at the moment, the king among them may be the US$32.24 billion (RMB200 billion) Yujiapu financial district in Tianjin. A replica of Manhattan, Yujiapu is more than one-third the size of its American counterpart and includes a reproduced Lincoln Center and a tower taller than the 1 World Trade Center building under construction in New York.
The Yujiapu financial district is just one of many areas under construction in the northeastern Chinese port of Tianjin. To finance infrastructure projects, the city had borrowed half a trillion yuan by the end of 2011 – equivalent to half the annual income of the city’s 13 million people.
Much of the financing for these massive projects came from an equally outsized entity: China Development Bank. The world’s largest policy bank, CDB has played an instrumental role in China’s building boom. It has financed domestic infrastructure projects of stunning proportions, from the Three Gorges Dam to China’s West-East Gas Pipeline. It has also ventured abroad, lending in exchange for resources and contracts for Chinese companies around the globe.
Henry Sanderson and Michael Forsythe, reporters for Bloomberg News in Beijing, offer new insight into the workings of this powerful institution in “China’s Superbank: Debt, Oil and Influence – How China Development Bank is Rewriting the Rules of Finance.” As the authors contend, their book is not just about a bank, but about China’s economic and political rise. “China’s Superbank” examines how CDB has facilitated the country’s economic growth and the success of its top companies, and how it has advanced Chinese power abroad.
As the authors write, “If the Communist Party is God, CDB is its prophet, extending the power of the Chinese state across the globe and cementing its power at home.”