Beijing: China, already the banker to the US and a major investor in emerging markets, is now positioning itself as the potential "white knight" saviour to debt-laden Europe, analysts say.
Beijing has vowed to support European countries struggling under mountains of debt by buying their government bonds, which experts say could help ease tensions over a range of trade issues as well as boost China's global standing.
Backing the euro also serves the Asian country's own interests by helping to ensure its biggest trade partner continues buying its exports while also diversify its world-leading foreign exchange holdings away from the dollar.
Chinese Foreign Ministry Spokeswoman Jiang Yu told reporters last Thursday that the European Union would "be one of the major markets for our forex investment" in the future.
No incentives
European officials, however, insist no incentives such as recognition of China's market economy status or a reconsideration of an arms embargo have been offered in return for Beijing's much-needed financial lifeline.
"On the one hand they get to be the white knight and maybe that has some political benefit," Patrick Chovanec, an economics professor at Tsinghua University in Beijing, said.
"It also fits with their plan to diversify away from the US dollar," he added.
Boosting its holdings of euro bonds is a good investment for China and could ease pressure on Beijing over its yuan exchange rate controls.
