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March 30, 2006
Currency controls in China?, Thurs., Mar. 30, 2006, 12:13 PM
My friend Murph has given me a heads-up re the apparent difficulty in repatriating capital from China. This bears watching.
"Hi Bill, I thought you may find this attached article of interest.
This is so typical of this resource rush in to China.
Any foreign resource companies that believe they will be repatriating funds out of China could be dreaming in technicolour.
The litmus test of foriegn companies repatriating will be Eldorado Gold (AMEX: EGO). They are scheduled for 200,000 oz/pa production at their Tanianshan project in 2007. If they are successful in China with this project, the game is on.
Otherwise, if they have their hands tied by the government; the entire China resource play will amount to a fraud.
It all reminds me of my favourite Chinese restaurant...Nun fo U
Cheers /Murphy"
The key paragraph (in the article and his letter) is the second last one.
p.s., I pondered the posting of the following item, which came to my attention a week ago, but it seems to be appropriate here.
I took Guy Lam to China almost 20 years ago. Guy had been a bright young lawyer, and General Counsel for Dean Witter Canada, where I first met him. When I moved to become founder and CEO of Canaccord Capital for eastern Canada, I brought Guy with me and, after helping him get his securities industry Officers & Directors exam passed, made him a Vice President. I then took him to places like Hong Kong, Taipei and Macau as my interpreter. He liked it there a lot, and so I set him up at Fred Kan & Company, a Hong Kong law firm, with his costs paid 50:50 by me and Fred Kan. He didn't bring me any business, so I cut him loose to do his own deals, and he started Pacrim, which became a Toronto Exchange listed company. I saw him a few years ago in Toronto, where he was saying he was buying suits cheaper than in Hong Kong. Can you imagine? I never discussed Pacrim.
Posted by Posted by Bill Cara on March 30, 2006 12:13:45 PM | Category: China
Discourse
I recently saw a presentation on a small gold exploration co that trades in the US but is exploring in china. (I won't mention the name here). The promoter made some interesting comments on how big the potentential was why we should buy soon.
The interesting thing was after the presentaion when the guy left, two guys who I assumed were form China said that the government controls the price of gold in china.( Bill if anyone knows if this is true please comment) The next thing is that this company was able to get a very large percentage of the claims that were suppose to have such great potential and these two guys questioned why the government would do this because they also want to control the production of their resources.
If you or any of your readers have information on China's gold controls or how a gov/private enity arangment works in china I would be interesting to hear.
If someting negative comes out of the Eldorado Gold situation I would also effect the Shares of another explorer that trades in Toronto SWG, Southwestern resources whose potential resource in much bigger,
Andrew
Posted by: Andy ![[TypeKey Profile Page]](http://www.billcara.com/nav-commenters.gif)
at
March 30, 2006 2:19 PM [link]
sorry I ment to say,
It would effect the shares, not I would.
Andrew
Posted by: Andy at
March 30, 2006 2:22 PM [link]
I read the article and though I (of course) do not have all the facts, it sounds to me that the repatriation problem stems from a dispute with the Chinese joint venture partner, not the Chinese government blocking any funds transfer. Now, of course, the joint venture partner may very well be a government entity, but that is a whole 'nother issue.
China Lawyer
Posted by: Dan Harris![[TypeKey Profile Page]](http://www.billcara.com/nav-commenters.gif)
at
March 30, 2006 12:48 PM [link]