New Eurasian Paradigm Replacing Dead Trans-Atlantic System as South America Realigns
October 30, 2014 • 11:18AM

The Trans-Atlantic system is dead, and a fundamental realignment towards the BRICS and Eurasia is now taking place among those nations which wish to survive. This is seen clearly in the maturing relationships between the nations of South America and China, following the crucial victory of Dilma Rousseff in Brazil which secured Brazil's role as the South American leader of the BRICS. As Xi Jinping noted in his congratulations to Rousseff, the sustained and rapidly developing strategic partnership between China and Brazil is one of "mutually beneficial and friendly cooperation" in order to "jointly promote the development of the world order."

Chinese President Xi Jingping meeting with Cristina Fernandez de Kirchner during his trip to South America in July for the BRICS summit. (Picture: Casa Rosada)

Take an overview of the pace of developments in South America, presented in more detail below. Yesterday, Argentine President Cristina Fernandez de Kirchner spoke by telephone to Xi Jingping, reaffirming their strategic alliance and close bilateral economic cooperation, with Xi Jingping extending to Kirchner an invitation to visit China soon. Mexico announced yesterday that it was awarding a contract to build Mexico's first high-speed rail line to the China Railway Construction Company (CRCC), as opposed to Germany's Siemens or France's Alstom. This only compounds the news that German manufacturing exports to Russia, as a result of the sanctions, are 26.3% lower than August of last year, resulting in an overall drop of 27.3% in auto sales since January, and 17.2% in machine exports. A German publication Telepolis is stating that the Western strategy of containment against both Russia and China is now backfiring, and that the SCO and BRICS processes are extremely significant and must be taken very seriously, along with a similar process of economic and strategic realignment occurring in South America with Mercosur and ALBA. China has intensified its criticism of the United States over its Cuba policy, accusing the US of violating the UN Charter by keeping the 50-year old embargo against Cuba in place — while Cuba has ironically offered the United States it assistance in combating the Ebola epidemic. And the newly reelected president of Bolivia, Evo Morales, appeared at the Vatican with Pope Francis at the International Meeting of Popular Movements sponsored by the Pontifical Council for Justice and Peace, where he was warmly welcomed with a rousing ovation, speaking about the need to end world hunger and stressing the need for developing countries to develop their technological and scientific capabilities. The Pope joined Morales, calling on the participants in the conference to "confront the destructive effects of the Empire of money... the idolatrous cult of money" in which the poor are considered throwaways "when the center of the economic system is the money-god, and not man." Pope Francis asserted, "The center of every social and economic system must be the human being, the image of God, created to dominate the universe." He called on the poor not be victims, but to be protagonists, to protest, and he stated that he would join them in that struggle, guided by the Christian doctrine of the Beatitudes which he described as "a guide to action, a program that we could say is revolutionary."

Meanwhile, China has announced that it intends to make the Silk Road Economic Belt and the Asian Infrastructure Bank central items on the agenda of the upcoming APEC summit in November, which will be hosted in Beijing. The new paradigm has clearly arrived and is here to stay; it is now requisite for other nations, including the United States, to make the decision to join this new international order, or to continue to be destructive tools for a dying imperial system which now threatens mankind with war, famine, and plague.

Chinese and Argentine Presidents Reaffirm Close Strategic Alliance, Economic Cooperation

Argentine President Cristina Fernandez de Kirchner and Chinese President Xi Jinping spoke by phone this morning, to reaffirm the strength of their strategic alliance and potential for close bilateral economic and trade cooperation, Xinhua reported today.

Xi told his Argentine counterpart that "all departments" of both governments have been in close contact since his state visit to Argentina last July, and that "bilateral cooperation has achieved new and positive progress" since then. Next on the agenda is implementation of the joint action plan agreed on by both governments and creation of the permanent inter-governmental commission, to promote stable and balanced development of bilateral trade.

President Xi told Fernandez de Kirchner, "I'm willing to maintain close communication and contact with you, will welcome you to China whenever you deem that appropriate, and hope to meet again" at the upcoming November meeting of the G-20 in Brisbane, Australia.

The Argentine President told Xi that his July visit had a profound and positive impact on her country and its people, and highlighted the various infrastructure projects China is helping to finance. She also emphasized her desire to maintain close and continual contact with Xi.

Geraro Ferreyra, a vice president of the Eling Group who also sits on the board of Electroingenieria, one of the companies that will build the Kirchner-Cepernic hydroelectric complex financed by China in Santa Cruz province, told the daily Telam that "the future of Argentine development passes through Russia and China," not the U.S. or the EU. Argentina has "a relationship of equals" with those BRICS nations, he said. The World Bank, the IMF, and the Inter-American Development Bank (IADB) can never offer the financing "without conditionalities," that China can for big infrastructure projects. The only thing Argentina gets from the U.S. are blows to the head, he said. Who needs that?

European Firms Lose Out to China in Bid for Mexico's Development Projects; Time to Dump the Trans-Atlantic System

Sticking with the crumbling Trans-Atlantic financial system clearly doesn't pay. Companies such as France's Alstom and Germany's Siemens are grumbling over the fact that they lost out on the bid to build Mexico's first high-speed rail line connecting Mexico City to Queretaro. It wasn't because they didn't have time to prepare the bid, as they claim, but rather because they couldn't offer the financing terms which the China Railway Construction Company (CRCC) did, providing 85% of the total value of the project at very low interest rates.

A consortium led by CRCC, and including a group of Mexican construction and engineering firms, won the bid. According to Etcetera Oct. 29, CRCC's estimate of the project's cost was 500 mn. pesos below the reference price set by the Mexican Finance Ministry, providing a savings to Mexico of 1.3 bn. pesos.

As Mexico's Communications and Transportation Secretary, Gerardo Ruiz Esparza, explained, Siemens and Alstom asked for more time to prepare their bids, but Mexico's timetable was defined by the government's budget and the "needs of the country, not those of private conglomerates."

Much to the distress of the Trans-Atlantic and imperial financial vultures, the issue of Mexican-Chinese relations and the potential for greater bilateral cooperation is very much on the agenda right now. Due to the crisis stemming from the disappearance of 43 students in Guerrero, President Pena Nieto has decided it is not appropriate to elave the country to attend the mid-November APEC conference in China. But diplomatic sources indicate he is very interested in developing closer relations with China. Mexico's former ambassador to China, Sergio Ley reports that hundreds of Chinese companies, including China State Construction & Engineering Corp., and China Telecom, are preparing to set up offices in Mexico, looking toward future involvement in the country's development.

According to China's ambassador to Mexico, Qiu Xiaoqi, the Mexico-Queretero rail line is just one of several energy and infrastructure projects in which China is interested, including airport, port, and rail construction, Excelsior reported Oct. 28. The Mexico-Toluca train, the Mexico City and Monterrey metros, the Guadalajara rail line, and the Yucatan-Quintana Roos Transpeninsular Train, among others, are under discussion. China, the ambassador said, has "many advantages" to offer in these areas, and "many capabilities which, in my view, are the best in the world."

German Sanctions Against Russia Hit... Germany

As the German Statistical Office reported this morning, German exports to Russia have suffered a big drop in August, a fall of 26.3% against the same month a year ago. For the period January-August 2014, the total drop is 16.6%, which implies that as the August figure shows, there is an accelerating decrease. Russia has fallen back to rank 13, from 11, on the list of German export markets.

The following figures indicate where the backlash from the sanctions is felt most — in sectors of Germany's industry. In the first eight months of 2014, machines accounted for 22.6% of exports, automobiles and auto parts for 19.0, chemical products for 10.0%. The German automobile industry has, however, suffered most, with a drop of 27.3% for January-August; machine exporters report a drop of 17.2%, chemical producers 6%.

SCO, BRICS Economics Plans Are Real, and Must Be Taken Seriously

In stark contrast to the mainstream media propaganda line that the BRICS is just another 'pie in the sky' that need not be taken seriously, the left-wing German online publication Telepolis writes, today, that the Shanghai Cooperation Organization (SCO), an organization overlapping with the BRICS, is being transformed from an originally-designed security alliance to an economic one. Former Indian diplomat M.K. Bhadrakumar has pointed out that the SCO member countries "rather sooner than later will have trade in their national currencies and establish regional financial institutions." Given the raw materials wealth of the SCO-related region, with its dynamically growing national economies of China and India, the entire region will become more independent from Western domination and economic-political blackmail, Telepolis writes.

The article notes that the Western economic sanctions against Russia have, paradoxically, given this SCO project a big boost: A whole set of new trade agreements between Russia and China, with the bilateral trade no longer counted in dollars, but in rubles and renminbi. The Chinese credit card system UnionPay is presently being introduced on the Russian market, reducing the latter's dependency on the two U.S. payment systems Visa and Mastercard. Both China and Russia are working on the development of an interbank system of their own, to become more independent from the SWIFT system of the West, Telepolis writes.

A similar process is underway with the BRICS group, as well as with two of the Ibero-American alliances, Mercosur and ALBA, which are taking steps toward independence from the Western systems. All in all, the Western strategy of containment against China and Russia has backfired, Telepolis assesses.

China Swings Hard at U.S. over Cuba Policy, in the UN General Assembly

China's deputy permanent representative to the UN, Wang Min, speaking before voting on the "Necessity of Ending the Economic, Commercial and Financial Embargo Imposed by the U.S. against Cuba," at the United Nations General Assembly (UNGA) on Oct. 28, swung hard at the United States, accusing it of violating the UN Charter by keeping in place the five-decade-old embargo against Cuba.

Wang Min stated:"This is not only a violation of the purposes and principles of the Charter of the United Nations and the relevant General Assembly resolutions, but also a source of enormous economic and financial losses for Cuba."

The UNGA has adopted a non-binding resolution for the 23rd consecutive year with 188 in favor and three abstentions. The United States and Israel voted against.

Wang pointed out that with the struggling world economy and the challenges to food and energy security, the embargo and sanctions against Cuba are "more unreasonable than ever before. Like most other countries, China hopes that the United States, in accordance with the purposes and principles of the Charter of the United Nations and the relevant General Assembly resolutions, will put an end as soon as possible to its blockade against Cuba."

In recent months, China-Cuba relations have improved dramatically. The Chinese Ambassador to Cuba, Zhang Tuo, said China and Cuba's interaction has become a paradigm of solidarity and cooperation among developing countries. It's also a pioneer in the development of China-Ibero-America relations. He said that during his term as ambassador, he has witnessed important high-level exchanges every year, including the visits to China by Cuban President Raúl Castro and First Vice President Miguel Díaz-Canel.

Last July, following the BRICS Summit at Fortaleza, Brazil, Chinese President Xi Jinping ended his Ibero-America visit with a symbolic visit to the barracks from which Fidel Castro launched the first armed assault of his Communist revolution in 1953. He also met with President Raúl Castro. Cuba has supported BRICS' calls for less U.S. and European dominance of international affairs. President Raúl Castro hailed the launch of the new $100 billion BRICS bank as contributing to "a new international order."

Following Xi's Cuba visit, a Xinhua commentary appeared that urged the U.S. to "rethink its Cuba policy." Calling for Washington to lift its sanctions, the article pointed out that China has been a "rising key foreign investor in Cuba" and has granted economic assistance to the country. "Instead of being an obstacle on Cuba's path of development, the United States should join China and other countries to become Cuba's constructive partner," it said.

Morales and Pope Francis Denounce 'Empire of Money' and Call on Poor to Be Protagonists in "Making History"

Pope Francis took the opportunity of a speech to the International Meeting of Popular Movements, held in Rome Oct. 27-29, to address the injustice of the current global order, but urged attendees to be protagonists in finding solutions, rather than resign themselves to their fate. It's clear that the Pope, himself, is a key protagonist as well, in the midst of the grave strategic crisis facing mankind.

The gathering, organized by the Pontifical Council Justice and Peace, brought together representatives of some of the planet's poorest and most vulnerable sectors, who are being trampled on by the current imperial system: peasants, workers from the informal sector, the homeless, the landless, and various ethnic, religious and minority groups, from five continents.

The only head of state invited was Bolivia's Evo Morales, the former coca-growers' leader who, as President, has battled the Empire's financial vultures to bring about impressive economic growth, with a focus on science and technology to uplift the largely indigenous population. Morales held a warm, informal meeting with the Pope during the conference, and received a rousing welcome and ovation when he spoke about the need to end world hunger, particularly stressing the need for developing nations to develop their technological and scientific capabilities, and referencing some of his government's achievements in this area.

In his speech to the gathering, the Pontiff drew the battle lines in the current strategic crisis, asking what it means to speak about solidarity. The scandal of poverty can't be addressed by resorting to strategies that "pacify and turn the poor into domesticated and inoffensive beings." "[Solidarity is] thinking and acting in terms of community, the priority of life for all, above the appropriation of goods by a few. It is to fight against the structural causes of poverty, inequality, lack of jobs, land, housing, the denial of social and labor rights. It is to confront the destructive effects of the Empire of money: the forced evictions, the painful emigrations, human trafficking, drugs, war, violence—all these realities which many of you suffer and which we are all called upon to transform. Solidarity, understood in its most profound sense, is a way of making history, and that is what the popular movements do."

In the current global system, he said, the poor and excluded are throw-aways, "surplus" goods. "This is a culture of happens when the center of the economic system is the money god and not man, the human being. The center of every social and economic system must be the human being, the image of God, created to dominate the Universe." Man has been taken out of the current system, Francis said, replaced by the "idolatrous cult to money. Indifference has been globalized! Indifference has been globalized!" But, he added, the poor are not resigned to sit with their arms crossed, waiting for solutions that never arrive. They wish to be protagonists, to protest, and, the Pontiff said, he wished to accompany them in that struggle. He said: "[We Christians] have something very beautiful, a guide to action, a program that we could say is revolutionary. I urge you to read it, to read the Beatitudes."