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Geraci speaks at the Opening Ceremony of 2017 CRRC AITDP

Michele Geraci talked about global challenges and opportunities under Trump’s era at the opening ceremony of the 2017 CRRC Advanced International Talent Development Programme, at the University of Nottingham, China.

If Trump imposes tariffs, on one hand this will lead to higher trade barriers, especially for goods imported from China, but, on the other hand, it will decrease investment barriers for inbound China to US investments. Under Trump’s era, the US will seek more investment in the development of infrastructure, especially in transportation: roads, bridges and airports. This represents a great opportunity for China, since China is the only country in the world that can deploy people, capital, know-how and raw materials in large quantities.

Geraci believes that RMB internationalization is a long and slow process. The impossible Trinity makes the impossible process of RMB internationalization very difficult. If a country wants to internationalize its currency, as the picture below shows, it can only choose two of the three variables. China is unlikely do abandon its current choice of a) keeping independent monetary policy and b) fixed (or managed) exchange rate

While taking about the European Union crisis, Geraci indicated that the zero interest rate policy by European central bank is a disaster for the allocation of capital, and it attracts hot money to where it should have not (peripheral countries), which is the basis of the crisis.

Geraci also discussed Trieste port as an example of terminal for the Maritime Silk Road. Trieste port, located at Italy, is a key location for the 21st Maritime Silk Road. It has a big competitive advantage with Central Europe and it has direct links to Germany and, from there, direct links to Scandinavia.

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