On resource exports:
The logic that resource economies must have positive trade balances as a rule did not stand reality check.
One may think that the amount of imports a resource economy can afford is not elastic in relation to their main export because they don't have any industry to produce basic living necessities.
In reality, what happens is the opposite: once few rich run away with what little hard currency the country had, the remaining people can't even buy those basic living necessities with debt, as their debt is worthless. Example: Venizuela
And reverse, when rich in those countries bathe in cash from resource exports, they spare no money for dumb excesses like gold plated Rolls Royces, and vaporize their trade surpluses very fast. You had to see Moscow in the time when oil was hitting $130...
And... quite a few African countries without any resource exports do have neutral trade balances with China, despite China being their biggest trade partner
Yes, I should have been more clear that this is just my opinions/speculation.
I'd said it's unexpectedly insightful for a talk on an internet forum. That's a very subtle line that I think only one out of 50 academicians around picked up.
One fact that can be made for sure is that China been preparing for a scenario as bad as North Korean trade isolation for decades. Not puny tarrifs that they are under now.
The whole arrangement of political alliances, preferred classes of assets abroad, currency swaps, infrastructure planning confirms that.
May I know, what is your day job?
88 : 40 = 2.2. At the ratio of 2.2, Africa does better on trade balance with China than most of Western nations...
>It is also afraid of buying assets in the US and Europe as it cannot guarantee that these assets will not be seized if need be for political reasons. Furthermore, it does not want to do anything that would reduce the value of the remaining dollars it holds. Trying to establish a resource base in Africa where they can build relationships, influence, enforce their property rights and protect trade routes, seems like a reasonable choice.
Have you come to that conclusion yourself?