Nanyang 1931: From piglets to giants

Chapter 224 This is too bad: using British assets to issue SAARC currency and loan it to Indonesia?
An internal meeting of Chinese people in the South Asian Association for Regional Cooperation (SAARC) ultimately failed to produce anything meaningful, so everyone dispersed and went home to think about it.

However, even though the project was shelved, Zheng Yi was not idle at all in the development. He soon raised funds on a large scale and began to level the land in Singapore, build houses and transport factories.

Although the land belonged to the British, Zheng Yi waved his hand and decided to give it up first and then requisition whichever piece he liked.

Penang is still too small. During the war, most of the Chinese in Southeast Asia fled to Penang. It was indeed a bit crowded, and there were simply not that many jobs available.

Now that the war is over, when it comes to diverting population, everyone will naturally think of Singapore first.

Although SAARC is short of money and has tight cash flow, Zheng Yi still decided to implement a housing system similar to that in Penang in Singapore, giving priority to ensuring that everyone has a home as much as possible.

For the Chinese in Southeast Asia, only when you have your own house here can you be considered to have put down roots in Southeast Asia; otherwise, you will have no sense of belonging.

Besides, we have just emerged from the shadow of war and we really need to carry out some big projects to revitalize the economy.

Zheng Yi himself still had some money. Even during the war, he actually made a lot of money. However, it was not easy for him to directly use his money in the Southern Alliance, and he himself did not like the real estate and construction industries.

Secondly, he did have other uses for the money in his pocket.

Therefore, during the entire development process, in addition to the people's self-financing and the construction team's advance payment, bonds were also issued in the name of SAARC to the people of SAARC and even to American banks.

The British expropriated the land first and then valued it. SAARC did not say that it would not give it, nor did it say that it would not count the money. But since there was not much money at the moment, they just put the matter aside for the time being.

Give it to me when you have money, how much is another matter.

"Master."

On this day, Zheng Yi was working in the British office when Lin Shaoliang suddenly came over with a smile.

"What's the matter?" Zheng Yi asked without raising his head.

There was a lot of work to be done and the war had just ended, so it was a busy time and he didn't dare to leave easily.

"Master, I just met with Mr. Sujia X from Indonesia. They seem to be fighting quite well. The Dutch were badly defeated and are now being condemned by everyone. They haven't even been able to return to several major cities."

Zheng Yi didn't even look up. "The Dutch had already declined significantly before the World War. They were successively harmed by Germany and Japan during the war, leaving them with very little industrial capacity. Isn't it normal for them to defeat the Dutch?"

"For so many years, the Dutch have relied on the British to gain a foothold in Southeast Asia. Now that the Dutch have lost, those Javanese natives should face the Anglo-Dutch coalition. Only those who can defeat the British will be considered the winner."

Lin Shaoliang nodded and said, "Master, what you said is right. Mr. Su Jia is also very clear about this, so... he said that Indonesia needs your support.

He said, "We are all Nanyang people and should help each other. He even said...we can form a big alliance together, with you as the leader and other Nanyang nationalist party members, and together we can deal with the British and...the imperialist powers."

As he spoke, Lin Shaoliang took out a cigar and lit it for Zheng Yi.

Zheng Yi was very surprised and asked, "Why? You seem to have a good impression of that Su guy? Do you think he can accomplish anything?"

Zheng Yi knew that in history, Lin Shaoliang was famous for saving the life of his father-in-law named Su. Of course, Su was like a little Teddy Bear in human form, and wherever he went, there would be artillery fire. His father-in-law also had a lot of people around him.

But because of this he did become a close friend of Su, which led to the creation of the richest man in Asia in history.

How come they fell in love with each other in this life?

Zheng Yi usually has too many things to do, and the situation in Indonesia is still unclear, so he just pays attention to it and does not personally contact the people there.

All matters were left to Lin Shaoliang and the Fuqing Gang.

After all, his identity is quite sensitive, and to be honest, almost all the indigenous leaders, big and small, in Southeast Asia are lining up to meet him, even the Mahatma of India is no exception.

They are all close neighbors, and everyone actually wants to be independent, so naturally they all want to test Zheng Yi's attitude.

But Zheng Yi, at least for the time being, did not want to express his opinion, so for such a long time, no one had met him and he had sent someone else to contact him.

Even among the British, he only met Henry, not even Good.

Lin Shaoliang said: "There is an old saying in China that a scholar may not succeed in a rebellion even after ten years. I think that the man surnamed Su is this scholar.
Now the British have taken action. Even a rotten ship has three pounds of nails. Even the declining British Empire is still imperialism. On the front line, I don't have high hopes for those Javanese."

Zheng Yi nodded, indicating that his analysis was correct.

To put it bluntly, the few weapons in the hands of the Javanese were all left to them by the Japanese. Even in the Japanese army, they were considered second-line equipment. They were all light weapons and no heavy weapons.

The level of organization, or rather the level of awareness, was even worse. Long before the Dutch and British returned, the conservatives and progressives within the Javanese had already started fighting, and there were quite a few people who opposed Indonesia's independence.

It can even be said that the independence movement was largely driven by the Su family and a few so-called "politically ignorant" people, who forced it forward without the support of grassroots society.

No matter how weak the British were, they would not be defeated by the Javanese in their first battle back in Southeast Asia.

"But Master, the Dutch East Indies, also known as Indonesia, is geographically divided except for a few large cities. Everywhere has its own faction, and each place has its own civilian security group.

The British could help the Dutch retake Jakarta and Palembang, but the vast majority of Indonesian natives could have scattered across rural areas and used their own security forces to fight the imperialist colonizers.

"So I think the Javanese will certainly suffer on the front lines, but the British and Dutch won't really gain an advantage either. In the end, it's bound to be a stalemate. Master, this is an opportunity for us. If you're willing to help, they still have a fighting chance."

"Chance?"

Zheng Yi smiled and said, "What do you think of this opportunity? How can I help?"

Liem Sioe Liong: "We can sell them some weapons. There are at least one million rifles in Penang, countless bullets, and a lot of various rocket launchers and mortars left."

"The war has just ended, and the military-to-civilian transition always takes time. It's just right that we can sell our unused weapons to them. If this business can be done, there should still be a huge demand.

And Master, you also know that the entire Asia is now a volcano about to erupt, and the demand for arms from various countries will be huge."

Zheng Yi laughed. "Do you really want me to be their leader? The entire Dutch East Indies has no real sense of nation or state. The Su family is only nominally elected. I'm willing to sell them weapons, but they need money to buy them. Do I need an IOU?"

Lin Shaoliang said seriously, "Teacher, I heard that our Southern Alliance is having some financial difficulties right now, especially with the owned lands in Singapore. It's a bit difficult to manage."

"Ok?"

Zheng Yi was stunned and asked, "Do you have a solution?" "Indeed, I do. I think this is an opportunity."

"What do you mean?"

"Master, do you think our Southern Alliance... can issue our own currency?"

"what?"

Zheng Yi was stunned, but frowned unconsciously.

"You mean, breaking away from the dollar and issuing a completely independent currency? I've actually thought about issuing currency a long time ago, but in the end, I felt it wasn't very meaningful. The main reason is that the SAARC is too small, and issuing a completely independent currency would greatly damage Penang's economic position as an international financial hub. Hmm..."

In fact, SAARC does not lack its own currency, it is just not mentioned much, because SAARC's currency is rigidly redeemed through the US dollar, and in the past it was even rigidly redeemed with the British pound.

That is similar to the Hong Kong dollar and Singapore dollar in later generations.

For every US dollar obtained through trade, twenty Penang dollars will be issued. At the same time, anyone can exchange them for US dollars at any financial institution in Penang, so in essence, this is just a voucher for the US dollar.

The benefit of such a monetary policy is that it facilitates foreign exchange settlement and cross-border payments, especially as a global financial and trading port. Tax evasion and money laundering are also two major economic pillars of Penang.

Of course, the disadvantage is that it does not have its own financial sovereignty and lacks effective means of monetary regulation of the economy.

However, as the saying goes, there is always a trade-off. There is no policy without side effects in the world. It is the same all over the world. Prosperity, development, and stability are actually antonyms in most cases.

In fact, as long as the SAARC trade can maintain a large surplus and the leverage ratio within SAARC can be maintained, the financial risk will not be too great.

The Hong Kong dollar has been playing this game for seventy or eighty years, and it has always been doing well. When Soros attacked the Hong Kong dollar in 97, Hong Kong Island actually survived through its own reserves.

Zheng Yi felt that his Southern Alliance would be larger than the historical Hong Kong Island in terms of both trade volume and economic size.

If SAARC really wants to issue its own currency, there will inevitably be foreign exchange controls. If SAARC's own currency cannot be promoted internationally, it will cause huge losses to SAARC's cross-border trade.

You must know that he is now ready to open his doors to accept European and American international capital and multinational corporations. Once currency controls are imposed and the SAARC currency lacks international liquidity, it is very likely that these international capital and multinational corporations will not come.

To put it more seriously, it is very likely that the existing multinational companies in Penang will consider moving out.

The Southern Association for Regional Cooperation (SAARC) is not like Southeast Asia. At most, it can only control a population of about 10 million. It is not even an independent national actor. How can it have any market potential to attract investment?

Lin Shaoliang said, "Given SAARC's current status, it could have issued its own currency long ago. What you're worried about is the lack of international liquidity of the SA currency. It doesn't need to circulate worldwide. As long as the entire Southeast Asia recognizes and uses our SA currency, the impact on trade won't be significant."

"Right now, the entire South Seas is like a volcano about to explode. The rule of Britain, France, and the Netherlands is already shaky. For the people in these places, it would be fine if they could not achieve independence in the end, but what if they could?

The entire Southeast Asia is in urgent need of a new currency that can replace the British pound and the French franc for asset valuation."

“Of course, the best alternative currency would definitely be the US dollar, but how many US dollars do these places have? How much trade can they do directly with the United States?

On the other hand, Singapore is the sixth largest port in the world and the best in Asia, and Penang is the industrial production center of Southeast Asia. Isn't it most convenient for them to conduct foreign trade with us? "

Zheng Yi frowned. "Then how can we let them own and use Nanbi? And what will be the anchor for the issuance of Nanbi?"

In this era, the US dollar is not the only world currency. This is mainly because the United States is the world's largest trade surplus country, and almost all countries in the world are short of US dollars.

If you don’t have US dollars, you will naturally have opportunities for other world currencies.

This is completely different from the situation eighty years later in history. In the world eighty years later, all the vested interest classes in the world, whether it is the country's foreign exchange reserves, the private property of the rich, or the private vaults of corrupt officials and dictators, are all denominated in US dollars.

To affect the world currency status of the US dollar is to affect the wealth accumulation of all vested interest groups in the world.

In comparison, things like oil and gold have long lost their anchor properties.

Lin Shaoliang: "I think right now, Indonesia's independence is our best opportunity. We have what they need most, but we don't really need anymore: weapons."

"We can lend them a sum of SAARC currency specifically for the purchase of our arms, and we can accept them repaying the debt with Indonesian minerals, oil, high-quality timber, tobacco, and food. If Indonesia successfully achieves independence, at least part of these assets will be denominated in SAARC currency."

Zheng Yi frowned slightly and couldn't help thinking.

It will certainly not be difficult for them to pay back this amount of money after independence. After all, China is the third most populous country in the world and even has abundant resources. We are all neighbors. As long as they are not too stupid, there is little possibility that they will simply default on their debts.

The loan itself can even charge interest. From a business perspective, it does not seem to cause him to break with the British and affect his relationship with those British multinational companies.

After all, Indonesia was a colony of the Netherlands, not Britain. At least half of the reason why Britain sent troops was because of Shell.

After the Netherlands lost Indonesia, it will basically say goodbye to the word "great power" and its relations with the South Asian Association for Regional Cooperation will definitely reach a freezing point, but so what?

never mind.

"What will serve as an anchor?"

Lin Shaoliang: "Of course, we will use the assets listed on the SAARC. However, this is a big deal, so we must proceed step by step, bit by bit. We will first use a portion of it as a test water."

"Which part?"

Lin Shaoliang: "I think it would be a good idea to use Singapore's British assets as an anchor. We are currently struggling with the pricing of these assets. What I mean is that we can securitize these assets and use them as an anchor to exchange for the first batch of completely independent South African currency without rigid redemption. We can then use this money to lend to Indonesia's independence army, allowing them to purchase our second-hand arms from the South Asian Association for Regional Cooperation."

After hearing this, Zheng Yi didn't react for a full three seconds.

After a while, he said, "Ah?"

I have to say, this guy really deserves to be the richest man in Asia in history?
How did they come up with this dirty trick?
"Asset securitization... Which bank do you plan to use to issue these securities?"

"Hong Kong Island, HSBC."

Zheng Yi: “…………”

Is it a loss?

(End of this chapter)