(November 23, 2012) The proposed takeover of Calgary-based oil and gas producer Nexen by Chinas state-owned oil giant CNOOC should be nixed by the Canadian government, says Probe Internationals Patricia Adams. As instruments of the Communist Party, Chinas state-owned enterprises (SOEs) are undisciplined by markets or the rule of law. Without subsidies, their rate of return on equity is negative. It would be impossible to stop them from distorting the Canadian economy, so Canada should just say no to CNOOC.
The Canadian government will soon decide whether to let Chinas state-owned oil giant CNOOC buy Nexen Inc., the Calgary-based oil and gas producer. A survey released this week shows that 72% of Canadians oppose the prospect of this Chinese Communist Party-led enterprise operating in Canada, with good reason.
Chinas state-owned enterprises (SOEs) are controlled by the Chinese Communist Party and their role is political to keep the Communist party in power. They receive subsidized financing from state-owned banks that receive subsidized savings from captive Chinese citizens who are not allowed to invest their money freely, as we in the West can. SOEs typically receive other subsidies and privileges such as free land, monopoly control over their markets, expedited licences, and exemptions from the need to meet environmental and other standards. In China, a country where the rule of law languishes, Chinas SOEs get away with pretty much anything, often at the expense of a bribe to a local official.
Though many are in awe of Chinas rise, it is a Potemkin village of misallocated capital that, at its root, depends on the suppression of consumer, labour, environmental, and investor rights. Fisher Investments calls it crony communism.
That is why researchers at the Transition Institute, a Beijing-based think-tank, want Chinese SOEs privatized and forced to operate according to market discipline and the rule of law, and not by political favour. They are not alone. The Chinese economist, Mao Yushi, the recent winner of the Milton Friedman Prize for Advancing Liberty, calculated that Chinas state-owned sector received 7.5 trillion yuan ($1.2-trillion) in subsidies between 2001 and 2009, without which they would have realized a negative average return on equity of 6.3%. The World Bank argues that Chinas SOEs represent a problem for China and is calling for their reform into real market-disciplined institutions, not ones that operate by dint of Communist party favours.
Thanks to their status as the special children of the Communist party, Chinese SOEs have become flush with cash at the expense of Chinese citizens, who must overpay for everyday products, who must endure the destruction of their environment and the seizure of their land, and who suffer the suppression of their right to sue to defend themselves. Waving cash obtained through such unethical means, Chinese SOEs are now on a shopping spree around the world for investments such as Nexen.
CNOOCs proposed takeover of Nexen cant go ahead until the government of Canada approves the $15-billion purchase under the Investment Canada Act, something it can only do if the takeover is likely to be of net benefit to Canada and not injurious to our national security.
The act requires foreign investors to adhere to our standards of free and fair enterprise, and to be accountable under the law. But Chinese SOEs do not ordinarily operate by our standards. They are notoriously secretive, they have inefficient cost structures and low productivity, and it would be virtually impossible to stop them from distorting the Canadian economic environment. Should a political issue arise between Canada and China, the SOEs would necessarily do the bidding of their owners the Chinese government.
Should a Chinese SOE make money by virtue of its Canadian investments, it will indirectly strengthen its master, the Chinese Communist Party, in its control over ordinary Chinese citizens. If a SOE loses money by its Canadian investments, it will directly hurt ordinary Chinese consumers and taxpayers, who will need to make up the shortfall.
Because of these disbenefits to the Chinese citizenry, reformers in China want the SOEs reformed in much the same way the West has reformed so many of our own SOEs by privatizing them, as Canada did with Petro-Canada and the U.K. did with British Petroleum. Because of the dubious economic benefit to the Canadian economy from renationalizing key parts of our economy and with the national being a foreign dictatorship to boot the government of Canada should simply say no. Nexen Inc.is an upstream oil and gas company developing energy resources in the UK North Sea, offshore West Africa, the Gulf of Mexico and Western Canada. Nexen has three principal businesses: conventional oil and gas, oil sands and shale gas.
Posted by: Alaska Paul ||
11/26/2012 21:10 ||
Top|| File under:
He [O] is a Communist without question promoting the Communist Manifesto without calling it so How shrewd he is in America. His cult of personality mesmerizes those who cannot go beyond their ignorance. They will continue to follow him like those fools who still praise Lenin and Stalin in Russia. Obama's fools and Stalin's fools share the same drink of illusion..
Lest we fergit, 1990's NET + CLINTONISM > FASCISM = merely "LIMITED COMMUNISM/
The US-n-only-the-US, i.e. the Nation = Govt-State that is the "tip of the spear" in setting up post-9-11 OWG-NWO, is the also the only one that has to be "restrained/controlled", correct?
The US-n-only-the-US is the only one that H-A-S or M-U-S-T "ABSORB/TOLERATE" A MAJOR NUKE-WMD TERROR OR OTHER MILITARY STRIKE, WID ITS CORRESPONDING MASS CASUALTIES = PHYSICAL DESTRUCTION, ETC. + N-O-T RESPOND WID MILITARY FORCE, CORRECT?
E.G. TOPIX > [Korea Herald] OBAMA NEEDS NEW STARTEGY ON NORTH KOREA TO OFFSET FAILED DE NUCLEARIZATION EFFORTS: EXPERT [Larry Miksch of Washington-based CSIS Think-tank].
* SAME > DEMOCRACY LET [traditionalist/
fundamentalist] AMERICA DOWN. Despite his election President-reelect Obama does not appear to represent the interests of many millions of Americans.
ARTIC > US Voters whom voted + helped re-elect Obama tended to come from Coastal Megacities long-used to Govt-led benefits = employment programs, OBAMA + OTHER US POLITICIANS MAY COME UNDER DEADLY/MORTAL RISK.
* SAME > CALL FOR IMMEDIATE/URGENT ACTION AT CLIMATE TALKS IN DOHA | WAVER OF [United/International] RESOLVE TO RISE TO CHALLENGE TO CAUSE GLOBAL CATASTROPHE, WORLD LEADERS WARNED.
* SAME > WORLD NATIONS STAND BEFORE CLIMATE "FISCAL CLIFF".
And Other to possibly lead to ...
* FREEREPUBLIC > WHY BARACK OBAMA WILL BE THE LAST PRESIDENT OF THE "UNITED" STATES.
* CHINA DAILY FORUM > [AmericanRepublic Manifestum.blogspot] AMERICAN MILITARY TO SUPPORT AMERICAN REPUBLIC REVOLT 2013.
* DEFENCE.PK/FORUMS > REVEALED: HOW THE US PLANNED TO BLOW UP THE MOON WID A NUCLEAR BOMB TO WIN COLD WAR BRAGGING RIGHTS OVER THE SOVIET UNION, to intimidate the post-Sputnik CPSU + Soviet Union.
Lessons from 1959 for desired non-elected future OWG-NWO + the Threat vee "the Global Govts-Perts Consensus is that there is no Global Govts-Perts Consensus".
D *** NG IT - SEE, I TOLD YA DIDN'T I, IFF WE DESTROY THE SUN [Moon] WE'LL SAVE THE EARTH, ESPEC FROM GWCC [Russkis]!
["FAMILY GUY" PATRIARCH + PROUD IRISHMAN PETER GRIFFIN LOOKING GRIMACINGLY = CONQUERERINGLY AT THE SUN[Moon] here].
The Sun shall surrender iff Peter has to destroy the Earth to do it!
A multi-volume chronology and reference guide set detailing three years of the Mexican Drug War between 2010 and 2012.
Rantburg.com and borderlandbeat.com correspondent and author Chris Covert presents his first non-fiction work detailing
the drug and gang related violence in Mexico.
Chris gives us Mexican press dispatches of drug and gang war violence
over three years, presented in a multi volume set intended to chronicle the death, violence and mayhem which has
dominated Mexico for six years.