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Strategies & Market Trends : True face of China -- A Modern Kaleidoscope -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (634)	11/18/2006 2:32:25 PM
From: RealMuLan	Read Replies (1) \| Respond to of 12464

Here is some truth about the ODA (Official Development Assistance) Japan provided to China since 1970. By OECD definition, ODA should include at least 84% of Free Grants. UK, Canada, and others developed nations' definition for ODA is 100% of free grants. After WWII, the US provided millions of ODA to Japan, and 98% of them were Free Grants. By contrast, 90% of the ODA Japan provided to China is low interest loan (3%-3.5% APR, some had lower interest of 0.75%). Japan had suffered from deflation for more than a decade, and their interest rate was negative. So the so-called ODA they gave to China is NOTHING but some smart investment. China has excellent credit, and has been responsible for ALL Japan's loss due to Yen appreciation against US$ (Yen appreciated from 240 Yen:US$1 in 1980, to 80 Yen:US$1 in 1990). So Japan has benefited from all the appreciation of Yen at China's expense (in terms of the loan they provided to China under the name of "ODA"). OECD supports limited Tied Aid in ODA, but Japan has used it in most of their aid to China. In 2001 alone, Japan provided ODA to China's 15 projects. Ten of these 15 projects has had string attached, which is ALL the supplies have to be provided by Japanese companies. Among ALL Japanese ODA projects in China, Japan has got 45% of the bids for ALL supplies. According to some official estimates, 30% of so-called ODA funds Japan provided to China have flowed back to Japanese economy. Due to these so-called ODA projects, in the TWO decades from 1980s to 1990s, Japanese products have saturated China's market, from cars, to machineries, to household appliances and consumer electronics. The ex-PM of Malaysia has once said, Japanese can usually make 200 percent profit on their so-called aid. Before China set up formal relationship with Japan in 1970, China's GDP counted 3.1% of the world total GDP, while Japanese GDP counted 7.1% of the world total. By 1990, 20 years after China has established relationship with Japan, Japanese GDP increased to 14% of the world total, while China's GDP declined to 1.6% of the world total.