From Beijing to Vieux Fort

The Star (St. Lucia) - - BUSINESS - By Chris­tian Wayne

Over the past decade China has be­come an in­creas­ingly im­por­tant source of in­vest­ment for the Caribbean— both in terms of for­eign di­rect in­vest­ment (FDI) and also for fa­vor­able debt fi­nanc­ing schemes ex­tended by Chi­nese state-owned banks. Hardly a new­comer to the scene, Beijing’s foray into the Caribbean was spurred by its bat­tle of mon­e­tary diplomacy against the Re­pub­lic of China (Tai­wan). Re­cent data, how­ever, sug­gests that China’s mo­ti­va­tions in the re­gion go be­yond its in­fa­mous One China Pol­icy.

De­spite agree­ing to sus­pend the prac­tice of check- book diplomacy, data shows that the prac­tice is still alive and well, ev­i­denced by the mas­sive 500% in­crease in Chi­nese FDI be­tween the years 2003 and 2011. Of that 500%, vir­tu­ally all of it took place along three cat­e­gories: nat­u­ral re­sources, raw ma­te­ri­als and large-scale in­fra­struc­ture.

Baux­ite in Jamaica; tim­ber and min­er­als in Guyana; and gas and as­phalt in Trinidad. Through a sim­ple sur­vey of China’s in­vest­ment port­fo­lio in the re­gion - mo­tor­ways in the Ba­hamas, con­fer­ence cen­ters and the­atres in Bar­ba­dos, air­port con­struc­tion in An­tigua, ma­jor road devel­op­ment in Do­minica, and a seem­ingly end­less pipe­line of na­tional sta­di­ums - it be­comes glar­ingly ob­vi­ous that Chi­nese FDI fol­lows a dual in­vest­ment the­sis: nat­u­ral re­source ex­trac­tion and/ or the ex­por­ta­tion of Chi­nese la­bor to will­ing coun­tries.

Ex­em­pli­fy­ing the pres­sures that the un­in­hib­ited im­por­ta­tion of Chi­nese la­bor ex­erts on lo­cal mar­kets, we need look no fur­ther than Suri­name. China Dalian In­ter­na­tional - a Chi­nese state-owned con­struc­tion con­glom­er­ate - was awarded a se­ries of in­fra­struc­ture con­tracts to upgrade the roads in and around Para­maribo. La­bor­ers from CDI resided in what were sup­posed to be tem­po­rary, makeshift camps along the rain­for­est, how­ever, more than a year later, many of these camps are still there, eerily rem­i­nis­cent of a refugee camp. Ac­cord­ing to a U.S. Em­bassy diplo­matic cable re­leased by Wik­ileaks: “Large groups of Chi­nese en­ter the coun­try via the west­ern bor­der with Guyana and re­ceive driver’s li­censes, of­fi­cial doc­u­ments and em­ploy­ment upon ar­rival through semi-le­gal or il­le­gal chan­nels. Un­able to pay debts, they are de facto in­den­tured la­bor, bonded to the or­ga­ni­za­tions that brought them to Suri­name.” Sto­ries such as these are not iso­lated, as a very sim­i­lar dy­namic oc­curred dur­ing the coun­try’s re­cent gold rush. A 2012 in­ves­ti­ga­tion into Suri­name’s fever­ish gold min­ing in­dus­try con­ducted by The Pulitzer Cen­ter con­cluded: “the gold fields of Bens­dorp are carved right out of the vir­gin rain­for­est in val­ley floors. The min­ers inch their way up the val­leys de­stroy­ing en­tire wa­ter­sheds by scrap­ing every or­ganic sub­stance away to get at the gold in the lay­ers below. The Suri­namese have ei­ther been pushed out or are noshows to this great un­fold­ing drama to con­trol--and pos­si­bly de­stroy-- the in­te­rior of their coun­try.”

Although Suri­name is the most dis­cussed ex­am­ple of Chi­nese la­bor dump­ing, it’s hardly the only one; the Baha Mar project in Ba­hamas is an­other no­to­ri­ous ex­am­ple.

Ac­cord­ing to the In­ter­na­tional Mon­e­tary Fund (IMF), China’s top trad­ing part­ners in CARICOM are: An­tigua and Bar­buda, fol­lowed by Trinidad and Tobago, Jamaica, the Ba­hamas, and Do­minica. Although trade is ex­tremely preva­lent in these coun­tries, it is ab­so­lutely onesided. In 2008, for ex­am­ple, 93% of CARICOM-China trade came in the form of Chi­nese ex­ports to the re­gion. In the last decade alone, Chi­nese ex­ports con­sis­tently ac­counted for over 70% of trade to the re­gion.

These se­vere eco­nomic im­bal­ances should be a ma­jor con­cern for Caribbean lead­ers. As long as China con­tin­ues to mo­nop­o­lize the re­gion’s com­mod­ity mar­kets while si­mul­ta­ne­ously un­der­min­ing lo­cal la­bor mar­kets, its for­eign pol­icy ten­ta­cles will in­evitably bur­row deeper and deeper into do­mes­tic af­fairs—threat­en­ing the self-de­ter­mi­na­tion of nearly 40 mil­lion peo­ple.

Bens­dorp, Suri­name is also a boom­town. The pre­ferred currency is gold, mined lo­cally and car­ried in pouches hid­den in one’s clothes. Eu­ros are the fa­vored hard currency be­cause of the prox­im­ity of Euro zone across the river, fol­lowed by the U.S. dol­lar and fi­nally, be­grudg­ingly, the hum­ble na­tional currency, the Suri­name dol­lar.

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