タグ: Shenzen

China 2020 – Goodbye Cash, Hello Digital Currency?

                by David Parmer / Tokyo

North Korean Supreme Leader Kim Jong-un says the DPRK may give the US a surprise “Christmas present” in 2019. This could be anything from a nuclear test to sending more long-range missiles out over the ocean or over Japan. Whatever Kim does will be “big news.” However, bigger and more important news seems to be forthcoming from China.

Reports suggest that China is on the verge of launching the world’s first central bank digital currency. The People’s Bank Of China (PCOB) has been working on digital currency for five years, and now a small-scale launch in the eastern cities of Shenzhen and Suzhou might be just around the corner.

While China is “pro” digital currency, it is “anti” crypto currency. China has banned Bitcoin and coin exchanges and has banned Initial Coin Offering (ICO) since 2017, and overseas exchanges are not able to serve Chinese customers.  

In October 2019 President Xi Jinping gave the green light to for further digitalization by stating that China should embrace the blockchain technology needed for digital currency. One big upside for China with the introduction of an accountable digital currency is to create the real possibility of the internationalization of the Yuan. This will aid in China’s Belt and Road scheme, and ultimately challenge the long time supremacy of the US dollar.

A national digital currency would go a long way to putting an end to China’s nagging problem of currency counterfeiting. Moreover, online payments in China are dominated by Ali Pay and We Chat Pay and the new currency would theoretically dovetail with this trend toward a truly cashless-society. 

The bottom line is that while the world might focus on Kim Jong-un’s dramatic antics toward the end of 2019, the really important developments are taking place in China without as much fanfare. Chia’s development and immanent launch of a secure, national digital currency leading to the internationalization of the Yuan is a story without fireworks, but one worth watching very closely.

(Compiled from online sources.)

Photo: DP/Tokyo

Asian Waters—The Astounding Pearl River Delta

Shunde, Foshan, Guangdong PRC (Photo: topwalls)

                              by David Parmer

Southern China’s Pearl River is 2400 kilometers long, making it the country’s third longest waterway. A glance at the map shows not one river, but rather a river system that becomes the Pearl River. The Liuxi,  Xi (West) Bei (North) and Dong ( East) Rivers join at Guangzhou and flow into the Pearl River Delta (PRD) and the South China Sea.

Just 30 years ago the PRD would have been impressive, and yes historic as China’s gateway to the West. But now,…now the PRD is the Pearl River Delta Economic Zone, and what was once green farmland with blue skies is now an urban megacity. Since 1980 there has been an astounding and amazing transformation that is far from over. Guangdong province has a population estimated at 83,000,000 and an area of 177,600 square kilometers; the area of the Pearl River Delta is estimated to be 55,000 square kilometers.

The Pearl River Delta is composed of 9 cities +2. They are:

  • Shenzhen
  • Dongguan
  • Huizhou
  • Zhuhai
  • Zongshan
  • Jiangmen
  • Guangzhou
  • Foshan
  • Zaoqing
  • Macau +Hong Kong

600px-Pearl_River_Delta_Area

Pearl River Delta (via wikimedia)

The area has been called the “world’s workshop” for good reason. Simply put, if you use some manufactured product today, whatever it  is, there is a good chance it has been produced in the PRD area. Clothing, electronics, watches, clocks garments, textiles and 60% of the world’s toys – all come from the PRD. And the industries mentioned above form industrial clusters where similar products are made with great efficiency. Couple all this with complete land, water and air transportation and excellent ports and you have today’s PRD.

China’s central government has big plans for this area. Big plans. By 2030 the area will be one big city of 40 million, any part of which can be reached by high speed train in one hour. ( Of note, the government is also planning a mega city in the North, combining Beijing, Tianjin and Hebei. This area will contain the dynamic Bohai Sea economic zone as well). Mass urbanization is clearly the future of China. The land-tilling peasant of past centuries will be but a memory. Within the megacities citizens will be free to move and not be restricted to the city, town or village where they are registered.

Pearl River Night

Pearl River at Guangzhou ( R.Morbach via flickr) 

The Pearl River moves from west to east, gathers and flows into the South China Sea and forms its own amazing delta, and is witness to the ongoing creation of the greatest urban area ever created in China, or on the Earth for that matter.