Speaking up

Beijing has been vocal recently in upbraiding the West for its poor financial regulation. This is both justified and a means of drowning out criticism of China’s alleged role in facilitating the economic crisis (artificially cheap goods and a willingness to buy US debt fuel unsustainable US consumption, which is leveraged by banks…). This reached a somewhat inevitable conclusion as Premier Wen Jiabao expressed fears for the safety of China’s US debt holdings. Now Zhou Xiaochuan, governor of the People’s Bank of China, has come out with a plan that would usurp the US dollar entirely as the global standard in favor of an IMF-issued currency. A louder and more forthright voice on international affairs reflects Beijing’s growing appreciation of its own global clout – and the fact that it is well-positioned to emerge stronger than most from the economic blues. This shift is also evidenced in a willingness to buy up foreign assets at a time when overseas companies are needy and therefore prices are cheap. No update on Australian commodities today, but China has been busy in the copper markets, helping drive up world prices for the metal by 28% so far this year. Of course, the kind of international role that Beijing craves cannot be bought with money alone. China’s willingness to compromise on greenhouse gas emissions will be an important test of its readiness to live up to the billing of a responsible global power.