The agreement is one other that raises questions on the extent of Trump’s financial involvement in Beijing.
The park – which is predicted to receive as much as $500 million in support from the Chinese government – is an element of an “integrated lifestyle resort” often called MNC Lido City.
Two days after MCC said it would supply a loan to Indonesian developers, Trump said in a tweet that he would attempt to help Chinese telecommunications company ZTE, hit hard by US sanctions, “get back to business quickly.”
Referring to its subsidiary, MCC described the theme park as “the primary project of the Central Research Institute of Building and Construction within the cultural and tourism industry” and was a “response” to China’s Belt and Road Initiative.
It can also be the primary project to mix Trump’s business interests with China’s signature infrastructure initiative, which goals to attach the world’s second-largest economy with Africa, Asia and Europe through an unlimited network of ports, railways, roads and industrial areas.
While Chinese corporations is not going to be directly involved in the development or financing of Trump’s properties, the theme park is a key a part of the three,000-hectare development, which the MNC describes as “probably the most prestigious entertainment and lifestyle project” in Indonesia.
Moreover, Chinese corporations are expected to allocate USD 500 million – half of the expected investment budget – putting its success or failure within the hands of decision-makers in Beijing.
It is unclear to what extent the Trump Organization was involved in the choice to incorporate Chinese state-owned enterprises (SOEs) within the project.
However, MNC Lido City’s marketing materials list the theme park and Trump properties as flagship features of the event, and company filings and internal documents show that the Trump Organization and the president’s two sons were directly involved in various stages of planning.
Negotiations for the Lido contract began before Trump’s election in November 2016 and Trump’s subsequent pledge that his family company wouldn’t engage in recent transactions with foreign governments during his presidency.
Still, “even when this deal is totally and completely public, it just deepens the perception of inappropriate behavior” around Trump’s business dealings, said Christopher Balding, an economics professor at HSBC Business School in Shenzhen. “Especially with a potential trade war, it doesn’t look good… Critics will be absolutely right to demand answers.”
China’s top economic official, Vice Premier Liu He, will travel to Washington next week for an additional round of negotiations on the hot-button issue of giant trade imbalances between the 2 countries.
Richard Painter, former U.S. President George W. Bush’s ethics lawyer, said the project was “problematic” and will violate the Constitution’s emoluments clause if Chinese government funds profited the Trump hotel.
“I would advise him to sell the hotel and other similar interests,” Painter said.
According to the MNC’s most up-to-date annual report, the Trump Organization and the MNC signed agreements for the Lido and Bali projects in 2015, leading to nearly $3.7 million in licensing and consulting fees paid to the Trump Organization.
Trump may even collect project management fees and will probably be eligible for extra, unspecified incentives.
In June 2016, MNC Land – a subsidiary of Indonesia’s largest media conglomerate MNC Group – signed a preliminary letter of intent with MCC. At the identical time, the MNC received a “letter of interest” from Sinosure, a Chinese SOE that focuses on supporting overseas investment projects.
The MNC’s billionaire CEO, Hary Tanoesoedibjo, told local media that the corporate would guarantee $500 million in financing from Chinese banks.
According to documents accessed by AFP, MNC representatives then made several trips to China to barter financing for the theme park with Sinosure and the state-owned Bank of China.
Hary flew to China for meetings concerning the project in October 2016, in keeping with the MCC website.
The documents show that in January 2017, Hary traveled to New York and Washington for a “project review with Trump” and the presidential inauguration.
Photos posted to Hary’s Instagram account show him meeting at Trump Tower with Trump’s sons Eric and Donald Jnr, and posing with Trump himself.
The Lido City project will not be the primary to boost eyebrows regarding Trump’s financial ties to China.
In early 2017, Beijing approved nearly 40 trademark applications that Trump has long sought to guard his business interests within the country.
McClatchy previously reported on the involvement of Chinese state-owned enterprises in one other Trump project in Dubai.
Trump Tower houses the American headquarters of the Chinese bank ICBC.
The MNC declined to reply AFP’s questions on the project, and MCC couldn’t be reached for comment. Neither the White House nor the Trump Organization immediately responded to emailed questions from AFP.
