Chapter 220: Becoming a Creditor of Europe (Fourth update, please subscribe)
Great careers often originate from accidents.
When Jiahe Trading Company was established in 1945, it was only a medium-sized small company aiming to establish grain reserves for Borneo and conduct grain trade in the international market.
But compared to other grain companies in this era, what it has is almost endless resources!
"Beef, wheat from South America and rice from Southeast Asia are all urgently needed by the markets of European countries. We can be like the Russians, we don't necessarily need hard currency, just exchange for machines..."
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Once again, in the office, facing several executives of Jiahe Trading Company, Li Yian emphasized the method of transaction-barter trade.
After the war, European countries had little hard currency. Without US dollars or gold, it is naturally impossible to purchase the needed materials from the international market. This is why the commodities of agricultural countries after the war are unsaleable and the European market is short of materials.
This is the so-called "dollar shortage". The "dollar shortage" marked by the shortage of hard currency lasted until the 1960s, and was slowly alleviated with the "Marshall Plan" and the subsequent European Renaissance.
Jiahe Trading Company is a company specially established by Li Yi'an to specialize in international grain and oil trade. It relies not only on Borneo's merchant fleet, but also on the foreign exchange reserves in his hands—— After all, the black market trade in the United States does make a lot of money, a dozen small targets!
This money is the basis for the company to engage in international grain and oil trade. Using US dollars to purchase grain and meat from South America and Southeast Asia, and then transporting it to Europe in exchange for the machinery needed for the construction of Borneo, can be described as killing two birds with one stone. Not only can it make a huge profit, but it can also speed up the construction of Borneo.
"But, Chief Li, many factories in European countries are currently recovering, and the Russians are also exporting grain to buy machinery. If we grab it like this, it is likely to raise the price of machinery. Moreover, for now, Borneo is not So many machines are needed. In Tunisia alone, there is a backlog of more than 30,000 pieces of machinery and equipment. In Italy, there are still about 100,000 pieces of equipment waiting to be shipped. In the cargo yard of the German search team, there is also a backlog of more than 50,000 pieces of equipment. Compared with various machines and equipment, what we need now are factory buildings and skilled workers.”
As the manager of Jiahe Trading Company, Li Jiebai decisively stated the reality and pointed out that the biggest problem in the boss’s suggestions was. The problem - there is no shortage of machines in Borneo.
There is no shortage of machines right now.
"Uh..."
Hearing this, Li Yian was stunned. Indeed, he had forgotten about this, but how could he miss the great opportunity in front of him.
"The currency values of European countries are now unstable. They will depreciate. If they are not exchanged for physical goods, we will suffer losses."
The reason why Li Yian mentioned barter trade is because through exchange with The export of Burmese rice to Europe reminded him of the information he had read. In the first two years after the war, Western European countries imported a large amount of grain from Russia, and the total import volume even exceeded that of the United States.
Because importing Russian grain and meat does not require foreign exchange and hard currency. Russia exported grain in exchange for machinery for postwar reconstruction. Even though Russia's own food supply is very tight, they are still doing everything possible to export food - even increasing the expropriation of grain from Ukraine. As soon as they were liberated, they asked for 400 million poods of food to be expropriated in Ukraine, equivalent to 65.52 million poods. Billions of kilograms of grain, even if it leads to famine.
What matters is the machinery, the machinery needed to rebuild industry.
Although there are currently no large rice fields in Borneo, Li Nian has plenty of hard currency and ships. He can make huge profits by just buying cheap rice in Southeast Asia and shipping it to Europe. European countries It didn't matter that there was no hard currency, like the Russians, Borneo needed machines to industrialize.
But unlike Russia, Borneo has no shortage of money for machines, but more people than machines. Even if you buy a bunch of machines, they will just sit there and rust because there are not enough workers.
In this case, it is necessary for Europeans and Russians to rush to buy machines and drive up prices.
With Cheng Jide’s reminder, Li Yian realized that Borneo did not have such urgent needs. And driving up the price of machines is not a good thing for Borneo! After thinking for a moment, Li Yian said.
“So... what about accounting?”
"Accounting? How do you say that?"
Li Jiebai and others were surprised.
“Basically, we designate a bank to grant credit to a certain country. The credit limit can be US$100 million or US$200 million. They do not need to deliver barter supplies to us now, but Use the accounting method to agree on a delivery date, which can be one year or two years later. Of course, interest will be calculated during the accounting period..."
Li Yian then explained the pre-war Germany's trade policy, pre-war Germany, like all European countries now, was severely lacking in hard currency such as gold and foreign exchange, which had a serious impact on the German economy. Because of this, after Hitler came to power, other countries Therefore, the barter trade of “de-goldization” was implemented.
When Germany conducts trade with a country, it is required to sign a "Barter Trade Agreement", which stipulates that the mutual import and export quantities of both parties must be balanced, and then both parties establish a barter account, and Germany imports a sum from this country. For raw materials or agricultural and sideline products, the other party will have to import German industrial products of the same value to form a hedge on the account. The ultimate goal is to keep the account in balance and no one owes anyone money. Through this barter trade, Germany not only obtained cheap agricultural products and raw materials through the so-called barter trade system, but also seized the market for British and American products, accelerated its own economic recovery, and suppressed the economies of the British, American and French.
But this is just the "barter trade" of the 20th century. In the 21st century, there has been a new evolution. What drives this evolution is China becoming the world's factory. Since China's resources are scarce, it needs a large amount of agricultural and sideline products and industry. raw materials and exports of industrial finished products. However, African and other third world countries do not have sufficient foreign exchange in their hands.
As a result, China provides loans to third world countries through banks, but these loans can only be used to purchase Chinese goods. How do those countries repay the loans? Of course, we use agricultural products and raw materials. It doesn't matter if you can't pay it out temporarily, just calculate the interest and repay it annually.
This approach, in another world, is accused by Europe and the United States of being a "debt trap" and "neo-colonialism".
This is not important. What is important is that Li Yi'an can learn from its model - providing loans to Western European countries. Of course, he is not giving them money directly, but using his own money to purchase relatively cheap food around the world. As well as the meat, after it is shipped to Europe, it is provided to European countries in the form of credit loans. Of course, the price is the price on the European continent.
“The current price difference between beef, wheat, coffee and other supplies in South America and continental Europe can reach three times. This means that with US$100 million in supplies, we can leverage US$300 million in funds. This The funds are deposited in designated banks in the form of bookkeeping. In the next two or three years, the European central banks will repay them in their own currencies, and we will use them to issue orders for machinery and equipment to their domestic companies. Of course, we can also use these funds. Funds acquire high-quality assets in various countries.”
And European countries will also welcome this trade method very much. After all, for them who lack hard currency, they need food and meat from abroad to fill people's stomachs.
At the same time, the multiple returns that this trade method can bring will undoubtedly install a powerful engine for the development of Borneo - European mechanical equipment technology will greatly accelerate the development of Borneo. continent's construction. Even if there is no need to import European machines in the future, it will not have any impact. The money can be used to acquire high-quality European assets.
Through trade accounting, the Eurasian Development Bank can also reach into Europe and quietly intervene in Europe's financial lifeline.
By that time, even the Europeans themselves will not be aware of the trade process. They have inadvertently opened their doors completely, and even handed over part of their financial lifeline to the Eurasian Development Bank. After all, they can do a lot with debt. If they are willing, those debts can be turned into high-quality assets in Europe, and With the revival of Europe, those high-quality assets will receive returns of dozens or even hundreds of times.
Thinking of this, Li Yian found that his situation seemed to be small again...
(End of this chapter)