The truth is that for all of the tough talk from Li Xinping about stopping the massive outflows of capital from China, some of it probably dark money obtained from dubious enterprises and kickbacks, nothing has changed in China or in the Western cities eager to share in the wealth. Rich, Young “Fuerdai” Chinese Are Buying Overseas Properties on Their Smartphones. Millennials acquire real estate in other countries as hedge against a weakening currency, homes for their own children when they study abroad
We are now seeing the first indications of the consequences of a Trump withdrawal from the international community. China has seen an opportunity to displace the United States and to advance China’s own aspirations to take a more aggressive and visible leadership role in the COP21 agreement. The simultaneous announcement of the de facto death of the TransPacific Partnership (TPP) has also opened a new opportunity for Chinese hegemony in the Asian economic and geopolitical world. Regardless of the Trumpist views on climate change and foreign trade, we are proverbially cutting off our noses to spite our faces.
In the last three days, both The Globe & Mail and CBC News have published disturbing stories about the scale of the Chinese infiltration of the Vancouver housing market that go well beyond anything understood or encompassed by BC government or federal government action on the problem. The CBC reported that at least $13.5 Million in cash has been confiscated from Chinese recently entering Canada at Vancouver International Airport. The following story, reblogged from The Globe & Mail, tells a tale of fraud, manipulation, and tax evasion on a massive scale. It also tells an embarrassing tale of gross incompetence by Canadian authorities. All of this is consistent with other investigative journalists reports from the United States on other similar fraudulent Chinese real-estate activities. Some of these reports go back years. The original Mossack Fonseca “Panama Papers” revelations that indicated that many of the Chinese elite with family links to Li Xinping, and The People’s Liberation Army had Mossack Fonseca accounts should have been a red flag for Canada, but was not. We are living in an entirely new global economy manipulated by dark forces. What will we do now that Vancouver has been ruined for decades to come?
This has just hit the wires tonight, September 11th. The South China Morning Post, perhaps the most influential and important bilingual, English and Chinese, media outlet in Hong Kong has suddenly and somewhat mysteriously announced that it is ceasing operations of its Chinese-language website nanzao.com. SCMP is owned by Jack Ma and Alibaba. It should also be noted that local elections in Hong Kong last week elected at least six new “pro-democracy” legislators.
The release of the Panama Papers is of such potential significance and magnitude that it is difficult to know where to begin. I have decided that I will begin with the most interesting and relevant topic for me, the Canadian angle: possible links from Mossack Fonseca’s tax haven shell companies to the Vancouver BC real estate market, the current Canada Revenue Agency investigation of KPMG’s Canadian offshore tax haven scheme, and potential conflicts of interest within CRA. The KPMG and CRA issues have been extensively investigated and reported by CBC News, and also discussed on this site.