How do Monetary and Financial Issues Interact with China’s Foreign Policy Making?
In the past two decades, the economy has loomed so large that it is dictating some of the terms of foreign policy or influencing the outcome of debates that involve economic interest. Th ere has always been a discrepancy between stated foreign policy and specific economic interests. In the early 1950s, because the young People’s Republic of China needed natural rubber, it bought it from the very Southeast Asian countries where it was simultaneously fomenting an insurrectional Communist Party, which was most active among the workers of rubber plantations. In the early 1970s, China’s continued need for copper dictated a very fast turnaround from Chile’s Allende government to the Pinochet junta. (Even today, China turns a cold shoulder to exponents of the nationalization of mining resources in Latin America, because of its own involvement.) Lack of trust among the world’s leading socialist countries once meant that the currency of choice in China-USSR trade was likely to be the Swiss franc.
KeywordsForeign Policy Natural Rubber Capital Control Currency Reserve Bretton Wood System
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