Huawei's bid failure points to tougher trade strategy
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[By Liu Rui/Global Times ] |
China's Huawei Technologies Co posted a public letter last Friday, inviting the US to investigate the firm, with the aim of winning compensation for the loss caused by its purchase of the US company 3Leaf being blocked.
In fact, however, the plans of Chinese enterprises' expansion in the US market have been frequently frustrated in recent years.
As early as 2008, the Committee on Foreign Investment in US (CFIUS) rejected a purchase request from Huawei for security reasons. These apparently show that the US government has already erected a firewall against Chinese enterprises. The US media is stoking public sentiment, telling China that it can continuously buy its national bonds, but please don't invest in US businesses.
An increasing number of economists have noticed that the US Department of Treasury is closely cooperating with its Federal Reserve Board (Fed). The Treasury Department has been desperately issuing its national bonds, and the Fed keeps buying them. Without solid real economy maintaining its solvency, such a dangerous currency game can't last.
China, as the primary overseas creditor of US government, has been carefully avoiding the risk brought by dollar depreciation, and Chinese enterprises are endeavoring to buy US firms in order to help ease the burden that China's foreign exchange control management authorities take.
Huawei's acquisition of US enterprises in fact represents the Chinese government's efforts to reduce the risks of holding foreign exchange reserves.
However, the US government apparently prefers Chinese holding their national debts to purchasing their enterprises.
Some scholars claim that China should follow the rules of the WTO and wait for its judgment.
Nevertheless, the interminable arbitration procedure will cost China's chances, while more importantly, the US will never take any risks in the arbitration that it believes not in favor of it. In fact, China's lack of a coping strategy against the increasingly obvious trade protectionism of the US has left its enterprises at disadvantage.
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