Pay Pre-Communist Debts: US Creditors to PRC

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Historical sovereign bonds | A Timeless Argument; American creditors are demanding that China honour pre-Communist debts. Economist, Sept 29, 2018.
http://www.economist.com/finance ... pre-communist-debts

Quote:

"Last year Russia repaid the last of its outstanding $70bn Soviet-era debt.

"the young Soviet Union shocked the world when it disavowed the Tsarist [which most online dictionaries use lowercase for the first t] debt in 1918.

Note:
(a) Joan, Bianco, president of American Bondholders Foundation (BAF)
(i) Both Bianco and Bianca are Italian surnames, much like both Blanc and Blanche are French surnames.
(ii) Italian-English dictionary:
* bianco (adjective masculine; feminine singular bianca, masculine plural bianchi, feminine plural bianche): "white"
https://en.wiktionary.org/wiki/bianco#Italian

The same "bianco" is also a noun masculine.
(iii) French-English dictionary:
* blanc (adjective masculine; feminine singular blanche, masculine plural blancs, feminine plural blanches): "white"
https://en.wiktionary.org/wiki/blanc

The same "blanc" is also a noun masculine.

The Spanish cognate is: adjective and noun masculine blanco.

(b) gold loan was issued in British currency only (not American currency, that is).
(i) common English name (not necessarily official one): 5% Reorganization Gold Loan of 1913
(ii) 善後大借款
https://zh.wikipedia.org/wiki/善后大借款
("袁世凱就任第二任 [in dispute; see zh.wikipedia.org for 中华民国大总统] 臨時大總統，袁世凱派 [中华民国首任国务总理] 唐紹儀開始與英国的汇丰银行 [Hong Kong & Shanghai] 、法国的法兰西银行、德国的德华银行 [Deutsch-Asicatiche Bank (DAB), 1889 (founded in Shanghai)-1988 (merged into Deutsche Bank)] 及美 [sic[ 国银行組成的四國銀行團")
(A)
(B) For 法兰西银行, see Banque de l'Indochine
https://en.wikipedia.org/wiki/Banque_de_l%27Indochine
(established in Paris in 1875; through a series of mergers (first in 1974) to no be part of Crédit Lyonnais
(C) The fourth bank in the consortium was Russian Asiatic Bank, the name at the time. See Russo-Chinese Bank  華俄銀行
https://en.wikipedia.org/wiki/Russo-Chinese_Bank
(1895-1926; in 1896 opened a Shanghai branch and was renamed as Sino-Russian Righteousness Victory Bank 华俄道胜银行; known as Russo-Assiatic Bank 俄亚银行 1910-1926)

* Russo-Chinese Bank Building  华俄道胜银行大楼
https://en.wikipedia.org/wiki/Russo-Chinese_Bank_Building
(The building was designed in Italian Renaissance style by the German architect Heinrich Becker, construction completed and opened in 1902; headquarters of the Central Bank of Republic of China 1928-1949)

(c) "China and Britain struck a deal in 1987 for a payment to British holders of imperial bonds."
(i) China, Britain Settle Claims. New York Times, June 8, 1987
https://www.nytimes.com/1987/06/ ... -settle-claims.html
(British "embassy spokeswoman said that under the agreement, China would pay Britain £23.5 million, or $37 million, and Britain would pay China $3.8 million to settle the claims.  China was previously barred from issuing bonds on the London market because of its refusal to honor debts incurred by governments before the 1949 Communist Revolution")
(ii) The NYT report also mentioned, "Supreme Court in March rejected a petition by holders of railway bonds issued in 1911 by the ruling Qing dynasty. Two weeks ago, China announced it would borrow money for the first time since 1949 in the American capital market."
(A) Jackson v People's Republic of China (N.D.Ala.1984) 596 F.Supp. 386
https://scholar.google.com/schol ... amp;as_sdt=40000006
("The jurisdiction of the Court was invoked [by plaintiffs] under the Foreign Sovereign Immunities Act of 1976 ('FSIA'), 28 USC §§ 1330, 1391 and 1602 et seq. * * * China alleges that the FSIA, which was enacted in 1976, does not retroactively apply to a cause of action arising out of a 1911 transaction")

, which was affirmed by the Fifth Circuit Court of Appeals in (1986) 794 F.2d 1490, rehearing denied, 801 F.2d 404, certiorari denied (1987) 480 US 917.
(B) Both the 1987 settlement with Britain and the Jackson lawsuit is about Hukuang (pinyin: Huguang) railway bond 湖广铁路债券.
(iii) I make a diligent search online and fail to find out whether China has sold bonds in the US or UK markets, in local currency. China rarely sold dollar bonds (especially since its ascension into World Trade Organization, its problem has been too much foreign reserve, not too little), and when it did in 2017, it was in Hong Kong. sEE Gabriel Wildau, China Sells First Dollar Bond in More Than a Decade. Financial Times, Oct 26, 2017
https://www.ft.com/content/a1ad3848-ba05-11e7-8c12-5661783e5589

Quote:

"China sold a combined $2bn of five and 10-year bonds at yields little higher than US Treasuries. * * *        'They could have just forced Chinese state investors to buy and held the yield flat to [US] Treasuries or even below. But by offering more attractive pricing, they can draw in strong interest from international investors,' said Mr [Owen]Gallimore[, Asia credit analyst at Australia and New Zealand Bank in Singapore].  China issues the majority of its debt in renminbi to onshore investors [ie, Chinese], so the sale of the dollar debt in Hong Kong also carried a symbolic value. The finance ministry had $18bn in foreign debt outstanding at the end of last year, worth only 1 per cent of total government debt. Of that total, 85 per cent was offshore renminbi debt." (brackets original).

"The finance ministry said this week that its sale was intended to set a benchmark against which Chinese companies — prolific issuers in Hong Kong’s US dollar debt market — can price their bonds, potentially allowing them to sell at lower rates.

"China sold $6.7bn in US dollar debt in 12 sales between 1993 and 2004, according to Shenwan Hongyuan Securities [Co, Ltd 申万宏源证券 (1972- ; based in Hong Kong)], but has not sold non-renminbi debt since then.

* There is no need to read the rest of the FT report.

(d) "In 1990 Taiwan's finance ministry said that repayment 'shall be held in abeyance pending the recovery of mainland China.' "

鄭琪芳, 國民黨找到385億債券? 財政部：依法不予處理. Liberty Times, Mar 17, 2017
http://news.ltn.com.tw/news/politics/breakingnews/2007957
("「兩岸人民關係條例」 [enacted in 1992] 第六十三條明訂：「國家統一前，下列債券不予處理：一、民國三十八 [1949] 年以前在大陸發行尚未清償之外幣債券及民國三十八年黃金短期公債。二、國家行局及收受存款之金融機構在大陸撤退前所有各項債務")