China’s Superbank

Inside the engine-room of China's economic growth--theChina Development BankAnyone wanting a primer on the secret of China's economicsuccess need look no further than China Development Bank(CDB)--which has displaced the World Bank as the world'sbiggest development bank, lending billions to countries around theglobe to further Chinese policy goals. In China'sSuperbank, Bloomberg authors Michael Forsythe and HenrySanderson outline how the bank is at the center of China's domesticeconomic growth and how it is helping to expand China's influencein strategically important overseas markets.100 percent owned by the Chinese government, the CDB holds thekey to understanding the inner workings of China's state-ledeconomic development model, and its most glaring flaws. The bank isat the center of the country's efforts to build a world-classnetwork of highways, railroads, and power grids, pioneering alending scheme to local governments that threatens to spawntrillions of yuan in bad loans. It is doling out credit lines bythe billions to Chinese solar and wind power makers, threatening tobury global competitors with a flood of cheap products. Another $45billion in credit has been given to the country's two biggesttelecom equipment makers who are using the money to win contractsaround the globe, helping fulfill the goal of China's leaders forits leading companies to "go global."Bringing the story of China Development Bank to life bycrisscrossing China to investigate the quality of its loans,China's Superbank travels the globe, from Africa,where its China-Africa fund is displacing Western lenders in abattle for influence, to the oil fields of Venezuela.* Offers a fascinating insight into the China Development Bank(CDB), the driver of China's rapid economic development* Travels the globe to show how the CDB is helping Chinesebusinesses "go global"* Written by two respected reporters at Bloomberg NewsAs China's influence continues to grow around the world, manypeople are asking how far it will extend. China'sSuperbank addresses these vital questions, looking at theinstitution at the heart of this growth.

Preface ixAcknowledgments xixChapter 1 Let 10,000 Projects Bloom 1The Wuhu Model 4The Chongqing Model 9Global Financial Crisis 12A Town Called Loudi 15Li's Story 18"Manhattan" in China 21Credit Risk in a One-Party State 26Cracks in the System 29Chapter 2 Turning a Zombie Bank into a Global Bank 39A Life in the Party 41The Princeling Party: The Beginning of State Capitalism 50Taking Over a Basket Case 55Transforming CDB from an ATM Machine 58Developing a Slogan 62Beating the Commercial Banks 64Gao Jian: Creating a Market for "Risk-Free" Bonds 68The West Self-Destructs: The Financial Crisis 72Moving Beyond Wall Street 75Chapter 3 Nothing to Lose but Our Chains: China Development Bank in Africa 85Made in Ethiopia 90Ethiopia's Zone: Exporting to the West 94China Africa Development Fund: The State's Private Equity Arm 96Rising Role of China in Africa 101Fixed Capital: Western-Style Lending 105African Tiger: Can Ghana Escape the Resource Curse? 108Fresh Capital 116Chapter 4 Risk versus Reward: China Development Bank in Venezuela 123Default in Bolívar's Country 125China's Venezuelan Adventure 126Loans for Oil 132Cars, Housing, and Gold: Good Business for China 136Ecuador 139Russia 140China in the Backyard of the United States 141Chapter 5 Funding the New Economy 147Obama's Dream 151Default-Free Bond Market 153Financing China's Global Company: Huawei 157The Final Frontier: Private Equity 163Acting as a Gatekeeper 167Imprint of the State 169Chapter 6 The Future 175About the Authors 181Index 183