China Emerges to Fill a Vac­uum Left by the West

Trillions - - In This Issue -

The Amer­i­can cen­tury is over, and the Chi­nese cen­tury has be­gun.

As the United States rapidly with­draws from its past role as a global pol­icy leader in cul­ture, diplo­macy, for­eign aid, man­u­fac­tur­ing tech­nol­ogy, in­ter­na­tional bank­ing and even cli­mate change, China has emerged to take over the lead­er­ship in many of those ar­eas, and this will have a sig­nif­i­cant im­pact on the world.

The more we know and un­der­stand about China, its cul­ture and its in­ten­tions, the bet­ter pre­pared we can be for the rapid and dra­matic shifts that are start­ing to oc­cur and that will ac­cel­er­ate in the near fu­ture.

The Open­ing the United States Is Cre­at­ing

Across an enor­mous phys­i­cal and geopo­lit­i­cal ocean from China, the as­cen­dancy of Pres­i­dent Trump and his “Amer­ica First” di­rec­tives have brought with them some of the most head­scratch­ing, whiplash-in­duc­ing changes in global pol­icy in a long time. Con­sider just these few ex­am­ples as a start­ing point:

On NATO: Un­til just last month (April), Trump had de­clared NATO was ob­so­lete and of lit­tle value. While he has now of­fered some praise for NATO’S past ac­com­plish­ments, he is still say­ing the other mem­ber coun­tries are not con­tribut­ing their fair share of de­fense bud­get­ing. He has also not in­volved them in any of his re­cent mil­i­tary moves in the re­gion, cre­at­ing even more in­sta­bil­ity.

On cli­mate change: In a 2012 mes­sage on Twitter, Trump no­to­ri­ously stated that “The con­cept of global warm­ing was cre­ated by and for the Chi­nese in or­der to make U.S. man­u­fac­tur­ing non-com­pet­i­tive.” Since tak­ing of­fice, Trump has moved to roll back many pre­vi­ously tough emis­sions-con­trol reg­u­la­tions in the United

States, us­ing Ex­ec­u­tive Or­ders as the means for do­ing so. His part­ner in crime run­ning the En­vi­ron­men­tal Pro­tec­tion Agency, the cor­rup­tand-get­ting-more-cor­rupt-by-the-minute agency re­spon­si­ble for man­ag­ing na­tional green­house gas emis­sions pol­icy, has rapidly be­gun rolling back EPA re­quire­ments for fac­tory emis­sions, au­to­mo­bile ex­haust con­trols and ev­ery­thing pos­si­ble as­so­ci­ated with fos­sil-fuel prospect­ing. The words “cli­mate change” are also now in the process of be­ing banned from any dis­cus­sion on the topic, as is all cli­mate change re­search pre­vi­ously con­ducted within the EPA. Trump is also di­rect­ing mas­sive cut­backs in the mon­i­tor­ing of crit­i­cal emis­sions in­for­ma­tion via NASA and na­tional cli­mate re­search within the EPA and the Na­tional Oceano­graphic and Aero­space Ad­min­is­tra­tion and is elim­i­nat­ing much of the back­ground sci­en­tific analy­ses that go with it. It is also likely that Trump will turn his back on the 2015 Paris Cli­mate Change Ac­cord as well.

On in­ter­na­tional treaties: The Trans-pa­cific Part­ner­ship (TPP) trade agree­ment was cer­tainly fa­tally flawed and de­served to be dropped by any U.S. pres­i­dent. But just drop­ping it and not com­ing up with a counter-pol­icy has left a re­gional mess. Trump has also fa­mously de­clared NAFTA to be a very bad deal for the United States and has de­clared his in­ten­tion to over­turn it. He has even vowed – in vi­o­la­tion of many other treaty ar­range­ments – to con­sider a tax on goods im­ported from coun­tries he be­lieves have ben­e­fited un­fa­vor­ably. Trump has also come out strongly against the United Na­tions (UN) as a body that doesn’t ever get much ac­com­plished and for which the United States is pay­ing way too much to keep go­ing.

On cur­rency pol­icy: Un­til about a week ago as of this writ­ing, Trump had called China a cur­rency ma­nip­u­la­tor that de­served some dras­tic sort of trade re­sponse. He has backed off on that – but only be­cause many peo­ple around him ap­par­ently con­vinced him that while that may have been true once, it is no longer a dom­i­nant part of China’s poli­cies and Wall Street and its in­ter­na­tional banks are guilty of cur­rency ma­nip­u­la­tion.

On for­eign pol­icy: Trump’s for­eign pol­icy so far has con­sisted pri­mar­ily of bash­ing spe­cific coun­tries, claim­ing that he as the master deal maker could redo treaties ev­ery­where to vastly im­prove the U.S. po­si­tion and cud­dling up to the Rus­sian Fed­er­a­tion and Vladimir Putin. That last part is be­ing rewrit­ten these days as the United States con­tin­ues its new mil­i­tary ac­tions in the Mid­dle East – but even then it ap­pears to be more about rais­ing Trump’s rat­ings than any­thing else. Trump and his team have also be­gun their own form of saber rat­tling when it comes to han­dling North Korea’s in­ter­con­ti­nen­tal mis­sile and nu­clear weapons tests by send­ing in a much big­ger part of the U.S. Pa­cific Fleet than be­fore. It is a show of force rather than a pol­icy, though, with no clar­ity be­hind the moves.

On for­eign aid: Al­though the de­tailed num­bers are not pub­lic on the is­sue, the Trump-driven White House Bud­get sub­mit­ted for con­sid­er­a­tion to the House of Rep­re­sen­ta­tives backs up Trump’s own past dec­la­ra­tions that he thinks for­eign aid is waste­ful. The U.S. State Depart­ment it­self is get­ting a bud­get cut of 32% from pre­vi­ous num­bers. Much of that will come out of for­eign aid of all kinds, money of­ten given to help sta­bi­lize a re­gion and help keep it close diplo­mat­i­cally. In­sid­ers also say that the in­ter­nal rec­om­men­da­tions within the State Depart­ment could cut U.S. fund­ing for the UN by as much as 50% from cur­rent lev­els. Con­sid­er­ing that the United States cur­rently sup­plies about 22% of the UN’S to­tal bud­get and 28% of its peace­keep­ing bud­get, these cuts would cre­ate havoc for the UN if they are im­ple­mented as planned.

In Comes China

With a United States lack­ing in con­sis­tent, thought­ful and states­man­like di­rec­tion on all of these is­sues, it is no sur­prise that one or more coun­tries have en­tered to take the lead on many is­sues.

Re­gard­ing the Mid­dle East, Rus­sian Pres­i­dent Vladimir Putin has at­tempted to take the lead­er­ship role, in part fu­eled by his pre­vi­ous stronger sup­port by Trump and by his coun­try’s strong con­nec­tions with Syria and Iran.

The far more pow­er­ful player in the game is China, how­ever. Un­like Rus­sia, it is far stronger eco­nom­i­cally and through its pure fi­nan­cial and trade clout can drive in­ter­na­tional diplo­macy in the way few other coun­tries can. In the past sev­eral

decades, it has also been slowly and care­fully craft­ing its moves to be­come such a pow­er­ful eco­nomic force, through care­ful lead­er­ship from the top as it tran­si­tions from pure com­mu­nism as its lead­er­ship ap­proach to one with a strong en­tre­pre­neur­ial and al­most cap­i­tal­is­tic econ­omy – in some re­spects.

As ex­am­ples of how China has moved in to fill the gap of lead­er­ship, con­sider the fol­low­ing moves:

The Belt and Road Ini­tia­tive: A Master Plan for World Trade with China

A ma­jor guid­ing vi­sion for what China is do­ing is what is re­ferred to as the “Belt and Road Ini­tia­tive.” Tak­ing its lead from the an­cient con­cept of the Silk Road, which helped an­cient China con­nect with the rest of the world to trans­form its on­ceiso­lated civ­i­liza­tion, this one in­cludes two sep­a­rate con­nec­tion routes to bring China closer to the rest of the world – and the rest of the world closer to China.

There is a land-based “Silk Road Eco­nomic Belt,” a set of China-backed in­fras­truc­ture and trade agree­ments that con­nect China to Europe, Cen­tral and West­ern Asia, South Asia and South­east Asia, pri­mar­ily by land.

There is also what is re­ferred to as “The Mar­itime Silk Road,” which con­nects China via the Sea of Ja­pan, the South China Sea, the In­dian Ocean, the Red Sea, the Suez Canal and the Mediter­ranean. In this sec­ond route, keys to the process are a series of highly de­vel­oped ul­tra-modern ports along China’s coast­line plus strong al­liances with many of the par­ties in­volved along the way.

As en­vi­sioned by the plan­ners, these two “roads” cover 63% of the world’s pop­u­la­tion, 35% of the world’s mer­chan­dise trade and 30% of the world’s GDP. These trade routes are also de­signed so that China can con­nect with 48% of the pop­u­la­tion along its routes within a max­i­mum of five hours.

China al­ready dom­i­nates U.S. trade. This master “Belt and Road Ini­tia­tive” will bring all of South and South­east Asia in con­nec­tion with China quickly and will soon link rapidly grow­ing Africa, emerg­ing mar­kets in Cen­tral and West­ern Asia and the “old guard” of main­land Europe into its grasp quickly.

The Asian In­fras­truc­ture In­vest­ment Bank

The Asian In­fras­truc­ture In­vest­ment Bank, with head­quar­ters in Beijing, is an in­ter­na­tional in­vest­ment bank with ob­jec­tives like those of the World Bank and the In­ter­na­tional Mone­tary Fund but aimed very much at Asia as its in­vest­ment tar­get rather than the world in gen­eral. As it says in its own de­scrip­tive ma­te­ri­als, “The Asian In­fras­truc­ture In­vest­ment Bank (AIIB) is a new mul­ti­lat­eral fi­nan­cial in­sti­tu­tion founded to bring coun­tries to­gether to ad­dress the daunt­ing in­fras­truc­ture needs across Asia. By fur­ther­ing in­ter­con­nec­tiv­ity and eco­nomic de­vel­op­ment in the re­gion through ad­vance­ments in in­fras­truc­ture and other pro­duc­tive sec­tors, we can help stim­u­late growth and im­prove ac­cess to ba­sic ser­vices.”

The AIIB was founded in De­cem­ber 2015 and opened up for busi­ness in Jan­uary 2016. In only a lit­tle over a year since that time, it has amassed to­tal in­vest­ment cap­i­tal of $92 bil­lion, con­trib­uted for the most part by con­tri­bu­tions from mem­ber na­tions.

Within the Asian re­gion, its mem­bers in­clude Aus­tralia, Azer­bai­jan, Bangladesh, Brunei Darus­salam, Cambodia, China, Ge­or­gia, In­dia, In­done­sia, Iran, Is­rael, Jor­dan, Kaza­khstan, Korea, Kyr­gyz Re­pub­lic, Lao PDR, Mal­dives, Mon­go­lia, Myan­mar, Nepal, New Zealand, Oman, Pak­istan, Philip­pines, Qatar, Rus­sia, Saudi Ara­bia, Sri Lanka, Ta­jik­istan, Thai­land, Turkey, United Arab Emi­rates, Uzbek­istan and Viet­nam. Non-re­gional mem­bers in­clude Aus­tria, Den­mark, Egypt, Fin­land, France, Ger­many, Ice­land, Italy, Lux­em­bourg, Malta, Nether­lands, Nor­way, Poland, Por­tu­gal, Sweden, Switzer­land and the United King­dom. Oth­ers such as Canada have been ap­proved for mem­ber­ship but are pend­ing en­try un­til they have paid in their nec­es­sary cap­i­tal con­tri­bu­tions.

No­tably miss­ing from the group are the United States and Ja­pan, both of whom have been in­vited but have de­clined to be­come part of it. The United States is out, re­gard­less of what else it says pub­licly about the or­ga­ni­za­tion, pri­mar­ily be­cause it sees this China-dom­i­nated al­ter­na­tive as a threat to its own eco­nomic clout. Ja­pan is out be­cause the United States pushed it not to join, as it has done less suc­cess­fully with a num­ber of

other re­gional and non-re­gional mem­bers.

The in­vest­ments al­ready ap­proved by the bank clearly in­di­cate it is fol­low­ing through on its char­tered in­tent. Ex­am­ples in­clude the fol­low­ing:

• Bangladesh: Nat­u­ral Gas In­fras­truc­ture and Ef­fi­ciency Im­prove­ment Pro­ject (ap­proved March 22, 2017)

• In­done­sia: Dam Op­er­a­tional Im­prove­ment and Safety Pro­ject (ap­proved March 22, 2017)

• Azer­bai­jan: Trans Ana­to­lian Nat­u­ral Gas Pipe­line Pro­ject (TANAP) to be co-fi­nanced with the World Bank (WB) (ap­proved De­cem­ber 21, 2016)

• Oman: Rail­way Sys­tem Prepa­ra­tion Pro­ject (ap­proved De­cem­ber 8, 2016)

• Ta­jik­istan: Dushanbe-uzbek­istan Border Road Im­prove­ment Pro­ject (ap­proved June 24, 2016)

China is very much driv­ing the bank’s agenda and is get­ting much of the credit for the re­sults it is al­ready achiev­ing.

The Re­gional Com­pre­hen­sive Eco­nomic Part­ner­ship Agree­ment

Even while the TPP agree­ment was – rightly, ac­cord­ing to many – go­ing down in flames as a pos­si­bil­ity, a re­gional al­ter­na­tive trade pact based in Asia was al­ready ris­ing as an al­ter­na­tive.

The Re­gional Com­pre­hen­sive Eco­nomic Part­ner­ship (RCEP) agree­ment ac­tu­ally took form among the Association of South­east Asian Na­tions (ASEAN) com­mu­nity mem­ber na­tions go­ing back to an ini­tial set of meet­ings in 2012. Driven very much by Chi­nese ob­jec­tives, it now in­cludes the fol­low­ing mem­ber states: Aus­tralia, Brunei, Cambodia, China, In­dia, In­done­sia, Ja­pan, Laos, Malaysia, Myan­mar, New Zealand, Sin­ga­pore, South Korea and Thai­land.

To­gether its mem­ber states rep­re­sent 30% of the global GDP and al­most half of the world’s pop­u­la­tion. With this group hav­ing its own strongly con­cen­trated trade association, as well as one strongly linked to the al­ready-wellor­ga­nized ASEAN mem­ber group, the po­ten­tial for strength­en­ing trade among its mem­bers with­out much con­cern about the rest of the world is very strong.

This is not to say that this trade deal is nec­es­sar­ily a great one for its par­tic­i­pants. But it’s the ex­is­tence of the trade agree­ment and its lead­er­ship that is the most sig­nif­i­cant is­sue here.

China as a Global Man­u­fac­tur­ing Hub

With a clear strat­egy to be­come one of the big­gest (if not the most dom­i­nant) tech­nol­ogy cen­ters in the world, China has made its mark on modern in­dus­try in record time.

It has done so by pro­vid­ing in­ter­nal sub­si­dies, in­fras­truc­ture sup­port, em­ployee train­ing and what­ever else it takes to be­come the re­source of choice for a large per­cent­age of the world’s elec­tronic com­pa­nies. Po­si­tion­ing it­self that way, us­ing its cheap la­bor as its lever­age, has also en­abled China to de­velop its own ca­pa­bil­i­ties as one of the most skilled elec­tronic chip, sub­assem­bly and com­plete prod­uct man­u­fac­tur­ers in the world.

Take the move by Ap­ple to man­u­fac­ture its smart­phone and ipad prod­ucts in main­land China. What that has done for Ap­ple is to make pos­si­ble some of the high­est-mar­gin prod­ucts in the world

while still con­trol­ling sup­ply chains very tightly. What it has done for China is to learn how to make ex­actly those same types of prod­ucts and all of their ma­jor sub-assem­blies and with qual­ity and per­for­mance char­ac­ter­is­tics that are rec­og­nized as best in class in many ways. It has also al­lowed China’s own smart­phones to un­seat Ap­ple and global leader Sam­sung in many Chi­nese sub­mar­kets.

This is sim­i­lar to the strat­egy used by Korea to be­come a global player in the au­to­mo­tive in­dus­try, some­thing that started first with Ja­panese auto com­pa­nies set­ting up shop in Korea for lower-cost sources of man­u­fac­tur­ing for their own ve­hi­cles. From the tech­nol­ogy trans­fer and em­ployee train­ing in­volved, Korea was able to de­velop its own strong au­to­mo­tive man­u­fac­tur­ing ca­pac­i­ties first, fol­lowed by the abil­ity to de­velop its own new tech­nolo­gies and car de­signs.

For China, what this means is that it is be­com­ing skilled in many of the ad­vanced man­u­fac­tur­ing tech­nolo­gies first (just like South Korea) and then build­ing on that with its own tech and ad­vanced de­sign ca­pa­bil­i­ties on top of it. It has been so suc­cess­ful in some in­dus­tries – such as pho­to­voltaic-cell pro­duc­tion and so­lar-en­ergy-plant de­vel­op­ment – that it now dom­i­nates the world in these crit­i­cal new in­fras­truc­ture tech­nolo­gies.

China also re­quires most com­pa­nies do­ing busi­ness in China to have Chi­nese busi­ness part­ners rather than al­low­ing their for­eign direct in­vest­ments (FDIS) to go into wholly-owned lo­cal sub­sidiaries of a com­pany from out­side China. This part­ner­ship means it is dif­fi­cult for any for­eign com­pany to avoid the tech­nol­ogy trans­fers in­volved.

All of the pol­icy in­volved in this, like in all of the other ar­eas de­scribed here, comes from the “top” of the lead­er­ship ranks in China and is part of the “master plans.”

Cli­mate Change

China, the sin­gle largest green­house gas emit­ter in the world, has cre­ated a pol­lu­tion mess of a stag­ger­ing mag­ni­tude.

This covers things from its in­tense, se­vere smog through­out the coun­try to hav­ing such high lev­els of al­gae in the wa­ter­ways that Olympic events once al­most had to be can­celed be­cause of both is­sues.

And yet now, in the time of Trump, China has emerged as the per­ceived leader in re­al­iz­ing the im­por­tance of tak­ing an ac­tive role in deal­ing with the re­sults of its emis­sions. China’s gov­ern­ment of­fi­cials had said for many years that, as a de­vel­op­ing coun­try, it should not have to cut back on emis­sions while de­vel­oped coun­tries have been dump­ing high amounts of car­bon diox­ide pol­lu­tion into the air for hun­dreds of years.

To­day, how­ever, in the face of such ter­ri­fy­ing smog within its own bor­ders, per­haps, as well as re­al­iz­ing that lev­er­ag­ing the need to do some­thing about that could help po­si­tion the coun­try well from a global per­spec­tive, China has re­versed those state­ments. It is not yet as well or­ga­nized about what to do about cli­mate change as other coun­tries, but it is now tak­ing many strong ac­tions to deal with it all. And its lead­ers are at least not in de­nial about the re­al­ity of cli­mate change and the hu­man causes of most of it (un­like Trump and many in the U.S. Congress right now).

For­eign Aid

Like the United States has done for many decades, China is learn­ing to use the magic of for­eign aid and for­eign in­vest­ment to ex­tend help while also lock­ing in strate­gic in­ter­na­tional part­ner­ships.

That can take many forms, but com­mon threads to most of the funds given out in this area are re­lated to in­fras­truc­ture de­vel­op­ment, dis­as­ter aid and stu­dent schol­ar­ships of one form or an­other. The funds are ad­min­is­tered by the Depart­ment of For­eign Aid within the coun­try’s Min­istry of Com­merce, which gives one idea of how the coun­try thinks of for­eign aid: It as­sists with com­merce. De­pend­ing on the item be­ing funded, the monies pro­vided can be in the form of out­right grants, in­ter­est-free loans or con­ces­sion loans.

That last cat­e­gory covers loans for which China re­ceives some sort of con­ces­sion from the coun­try or or­ga­ni­za­tion re­ceiv­ing the loan. This can be in the form of guar­an­teed pri­or­ity ac­cess to some­thing con­nected with what is be­ing

funded. In the case of funds to sup­port min­ing or oil drilling, for ex­am­ple, it could guar­an­tee China pri­or­ity ac­cess to some of the rare ma­te­ri­als be­ing mined or drilled for, of­ten at a lower-than-nor­mal price. Other forms of con­ces­sions that are known to ex­ist are con­di­tions China may ask for to re­strict ac­cess to what­ever is be­ing funded, based on who are China’s friends and who are not.

Up un­til the end of 2009, China had al­ready pro­vided funds for a to­tal of 2,025 in­fras­truc­ture projects. These in­cluded projects re­lated to farm­ing, wa­ter dis­tri­bu­tion, con­fer­ence build­ings, ed­u­ca­tion fa­cil­i­ties, power sup­ply, trans­port and in­dus­trial fa­cil­i­ties of many kinds. There are also sec­ondary-source fi­nanc­ing ar­range­ments that China en­gages in, by spon­sor­ing Chi­nese com­pa­nies do­ing work in Africa to ef­fec­tively “buy down” the price of po­ten­tial con­tract bids within the coun­tries where those com­pa­nies are do­ing the work.

Just in the past year China used its for­eign fi­nan­cial out­reach to ad­vance its in­ter­ests through the fol­low­ing in­vest­ments and for­eign aid:

• Africa’s In­te­grated High-speed Rail­way Net­work: a ma­jor pro­ject to con­nect all of the con­ti­nent’s cap­i­tal and ma­jor ci­ties by rail

• China’s Silkroad In­ter­na­tional Bank (SIB) opened its doors in Dji­bouti, lo­cated on the Horn of Africa, pre­cisely along the Mar­itime Silk Road

• Be­gin­ning con­struc­tion of the 90-acre China Naval Base in Dji­bouti, right next to those run by the United States and Saudi Ara­bia (Ja­pan has also re­cently de­cided to ex­pand its naval base in Dji­bouti as a coun­ter­bal­ance to the Chi­nese one.)

• Largest ever Ethiopian Pa­per and Pulp Mill, built by a Chi­nese en­gi­neer­ing com­pany with China’s back­ing

• The Africa Union Mis­sion in So­ma­lia: $1.2 mil­lion came from China

• Built mul­ti­ple new is­lands in the South China Sea to es­tab­lish its dom­i­nance over that im­por­tant ship­ping, fish­ing and mil­i­tary re­gion (China no­tably ig­nored the Hague Tri­bunal’s rul­ing last year that it had no right to build those is­lands or to seize ones al­ready present there.)

• Com­mit­ted to plans with Egypt for the de­vel­op­ment of seven ports along the Suez Canal and help­ing sup­port Egypt in cre­at­ing a ma­jor in­ter­na­tional lo­gis­tics hub, all of which will sup­port China’s Mar­itime Silk Road ini­tia­tive

• China In­vest­ment Cor­po­ra­tion (CIC), a sov­er­eign wealth fund, ac­quired 19% of Prima Coal, a sub­sidiary of In­done­sia’s largest coal miner

• $1.6 bil­lion in for­eign direct in­vest­ments in In­done­sia

• $24 bil­lion of new in­fras­truc­ture in­vest­ment com­mit­ments for the Philip­pines

In ad­di­tion to the above, just in the past six months China has held no­table high-level meet­ings in per­son in Africa with the Re­pub­lic of Congo, Guinea, Nige­ria, Tan­za­nia and Zam­bia. Asian meet­ings are too nu­mer­ous to count but have ex­panded no­tably in the Philip­pines since Pres­i­dent Duterte ex­pressed in­ter­est in ex­plor­ing al­ter­na­tives to the United States as a prin­ci­pal ally.

As might be seen in what is listed above, the emerg­ing na­tions of Africa are of­ten some of the big­gest ben­e­fi­cia­ries of Chi­nese for­eign in­vest­ment. Al­though ex­act fig­ures are still hard to come by, it is es­ti­mated that around 50% of Chi­nese for­eign aid is be­ing fun­neled to Africa even now. One ma­jor by-prod­uct of these in­vest­ments and aid are con­ces­sions such as those dis­cussed above, in the form of low prices and con­trol of unique and pre­cious nat­u­ral re­sources avail­able on the African con­ti­nent. A sec­ond pay­off is in Africa’s pos­i­tive view of China as a benev­o­lent part­ner who is per­ceived to be with­out any hid­den agenda. That last part is far from the truth, how­ever, but the part­ner­ships are con­sid­ered vi­tally im­por­tant as African coun­tries grow in eco­nomic and po­lit­i­cal im­por­tance glob­ally.

For­eign Pol­icy

China has also be­gun mak­ing waves re­cently by

mak­ing ma­jor pol­icy state­ments about sev­eral in­ter­na­tional is­sues.

Sup­port for an In­de­pen­dent Pales­tinian State

China’s For­eign Min­is­ter Wang Yi held a joint press con­fer­ence with Pales­tine’s For­eign Af­fairs Min­is­ter Riyad al-ma­liki on April 13 in Beijing. There, Wang de­manded an end to Is­rael’s con­tin­u­ing il­le­gal oc­cu­pa­tion of Pales­tine and said there must be an in­de­pen­dent Pales­tinian state.

With what is be­com­ing a defin­ing char­ac­ter­is­tic of the cur­rent Chi­nese ad­min­is­tra­tion on ma­jor global pol­icy mat­ters, Wang went on to take even stronger diplo­matic po­si­tions in this mat­ter. He called for an im­me­di­ate restart to Is­raeli-pales­tinian peace talks, which have ground to a com­plete halt as Is­rael has stepped up its con­tin­ued con­struc­tion of il­le­gal set­tle­ments. He also strongly crit­i­cized the U.S. ad­min­is­tra­tion and Congress for con­tin­u­ing to sup­port Is­rael’s apartheid-like poli­cies.

He also pointed out that Pales­tini­ans are still be­ing blocked from their in­de­pen­dence de­spite the UN hav­ing passed Res­o­lu­tion 181, which called for the cre­ation of that Pales­tinian state over 70 years ago.

China has re­cently stepped up its in­volve­ment in the Pales­tinian is­sue. Last year, as part of a ma­jor speech he gave at the Arab League, Chi­nese Pres­i­dent Xi Jin­ping an­nounced that the coun­try would be giv­ing US$7.6 mil­lion in aid to Pales­tine.

In re­sponse, Pales­tine’s al-ma­liki ex­pressed his ap­pre­ci­a­tion for what China was al­ready do­ing for his peo­ple and hoped it would take on an even big­ger role for them in the fu­ture. “We do en­cour­age China to do more of this kind of ap­proach, to see peace ul­ti­mately achieved in our re­gion,” he said.

Ac­tions and Warn­ings Re­gard­ing Es­ca­lat­ing Ten­sions with North Korea

Han­dling any kind of diplo­matic sit­u­a­tion in­volv­ing North Korea would be tough for any coun­try, but China has more than stepped up to the task.

With China be­ing one of the few coun­tries in the world that ac­tively trades with North Korea (for coal), it has a unique op­por­tu­nity for direct lever­age. So, in Fe­bru­ary, when it was clear North Korea was go­ing to con­tinue es­ca­lat­ing its mis­sile launches and nu­clear test­ing, China told North Korea it was im­me­di­ately can­cel­ing all coal or­ders with North Korea. North Korea chose to ig­nore the de­ci­sion and shipped coal any­way, only to have its barges laden with coal turned away by China in mid-april.

In the mean­time, Trump, again lack­ing any strat­egy to go with his words, kept telling the world how big a prob­lem North Korea was and that he would solve it. Rather than go after in­creased sanc­tions, as many oth­ers would have done, he sup­ported a move from his mil­i­tary for a sig­nif­i­cant in­crease in U.S. naval warship pres­ence along the coastal re­gions of South Korea.

With Trump be­ing seen by many world lead­ers as highly re­ac­tive, con­cerns have al­ready been ex­pressed through­out the world that Trump might launch his own, pos­si­bly pre­emp­tive, mis­sile strike against North Korea directly. For­tu­nately for the world – per­haps, any­way – China’s Pres­i­dent Xi had just met with Trump while those ten­sions with North Korea were ris­ing. And China took to the world stage af­ter­wards to urge cau­tion in the North Korean con­flict and to en­cour­age both sides to re­main calm.

It is true that North Korea’s lead­er­ship is suf­fi­ciently un­sta­ble and un­pre­dictable that even the best po­lit­i­cal minds in the world have not fig­ured out a good way to deal with the coun­try. China it­self is hav­ing chal­lenges know­ing how to ex­ert trade/ sanc­tion pres­sures on North Korea while urg­ing cau­tion from South Korea, the United States and U.S. al­lies. It is also seen in the awk­ward po­si­tion as not be­ing able to af­ford a com­plete melt­down of North Korean lead­er­ship, even though West­ern coun­tries may see that as a good goal. For China, if the gov­ern­ment of North Korea were to fall for what­ever rea­son, mi­grants from North Korea could flood into China’s ad­ja­cent ter­ri­to­ries, look­ing for food, hous­ing and wa­ter. At best that would put a mas­sive drain on China’s re­sources; at worst it would cre­ate ma­jor in­sta­bil­ity that could take a decade or more to re­solve.

China has also upped its will­ing­ness to par­tic­i­pate in multi-party dis­cus­sions on the sit­u­a­tion and is grow­ing even more flex­i­ble as to the form of those dis­cus­sions. As China’s For­eign Min­is­ter Wang

Yi said on April 14, “As long as it is talk, China is will­ing to sup­port it: Ei­ther it is for­mal or in­for­mal, one-track or dual-track, bi­lat­eral, tri­lat­eral or quadri­lat­eral.”

For the time be­ing, China is tak­ing the very pub­lic po­si­tion of en­cour­ag­ing thought­ful­ness and calm in a very del­i­cate po­lit­i­cal sit­u­a­tion and us­ing tighter sanc­tions rather than the open threat of war to bring a halt to North Korea’s mil­i­tary moves. Whether that strat­egy will work or not is un­clear, but it is clearly a strange world where China is per­ceived as hav­ing the voice of pa­tience in these mat­ters.

The Cul­ture of Chi­nese Lead­er­ship – and Why It Works

Just as the United States was founded with one set of guid­ing prin­ci­ples, which have in­flu­enced all gen­er­a­tions since, so too is the sit­u­a­tion with China.

For the United States, the coun­try’s founders came to the North Amer­i­can shores de­ter­mined to fight for things like re­li­gious free­dom and stand­ing up for the rights of in­di­vid­u­als. Gov­ern­ment was a means to an end rather than a guid­ing cen­tral force to con­trol ev­ery­thing. That may seem hard to imag­ine in modern times, con­sid­er­ing all the ways in which the fed­eral gov­ern­ment ma­nip­u­lates modern life. But the cul­ture of the founders has con­tin­ued as a per­va­sive part of the way cit­i­zens are brought up, with sup­port for in­de­pen­dence, the Con­sti­tu­tion­ally pro­tected con­cept of free press, the Con­sti­tu­tion­ally des­ig­nated con­cept of a gov­ern­ment that is highly de­cen­tral­ized through the states and the abil­ity to fight for what one be­lieves that is built into ev­ery­thing that hap­pens in the United States. Whether it works in prac­tice is less the is­sue; it is the col­lec­tive cul­ture that mat­ters. It is also why many be­lieve that, no mat­ter how much the lead­er­ship in Amer­ica may choose to over­reach its Con­sti­tu­tion­ally al­lowed bound­aries, there is a point at which the Amer­i­can cit­i­zenry will push back and re­volt.

In China, the cul­ture was also set long ago and is equally em­bed­ded in its psy­che. For mil­len­nia, within the gov­ern­ment in China, even when the coun­try was bro­ken into smaller states in an­cient times, the idea of an al­most god­like cen­tral lead­er­ship was part of what ev­ery­one un­der­stood and ac­cepted. Part of the rea­son for this was a be­lief that those at the top had ac­cess to unique knowl­edge and skills that oth­ers did not.

To this day, the Chi­nese still be­lieve that, and their state struc­tures sup­port it. It is part of why most de­ci­sions are made “at the top” on al­most ev­ery­thing, both in gov­ern­ment as well as com­pa­nies. China’s court in­sti­tu­tions, some­thing those in the West­ern coun­tries see as the means by which gov­ern­ment wrongs can be righted, also re­port to the same top of gov­ern­ment chan­nels, with the ef­fect that no mat­ter what is de­cided, it can­not hap­pen with­out the direct in­volve­ment of and buy-in with gov­ern­ment lead­er­ship.

An­other fac­tor work­ing to sup­port this cul­ture is the vir­tual block­age of al­ter­na­tive opin­ions and even facts from en­ter­ing the coun­try’s me­dia con­ver­sa­tions, in the press, via tele­vi­sion and ra­dio and even in so­cial me­dia. In­ter­nal so­cial me­dia ac­counts in the coun­try must be for­mally reg­is­tered, with con­tact in­for­ma­tion, pass­port data and more, to quickly iden­tify the source of any com­mu­ni­ca­tion that may be let out in the coun­try through any means. That also ex­tends to ac­cess to out­side news sources and search en­gines, which block the dis­tri­bu­tion of any con­trary opin­ions through­out the coun­try.

The ef­fect of the above for all is to con­tinue to re­in­force the mes­sage that se­nior Chi­nese lead­er­ship is al­ways “do­ing the right thing” and is do­ing so “with the best in­for­ma­tion” for the great­est com­mon good. There may be oc­ca­sional protests and crack­downs on them, but those are rare, and in­for­ma­tion about what re­ally hap­pened in each case is quickly si­lenced. Add this to the thou­sands of years of his­tory of a peo­ple al­ways look­ing up to its gov­ern­ment lead­ers at the top to make those de­ci­sions and you have a coun­try very much ready to sup­port and fol­low the lead­er­ship in charge.

The Sub­tle Roles of Tai Chi and Qigong

One of China’s sources of power is its very an­cient cul­ture and its be­lief in and uti­liza­tion of chi, or the life force. The most vis­i­ble as­pect of this part of Chi­nese cul­ture is tai chi, a med­i­ta­tive ex­er­cise that con­sists of spe­cific fluid move­ments and

co­or­di­nated breath­ing. Less known and more pow­er­ful is qigong.

Qigong has long been part of Chi­nese cul­ture. A Ne­olithic ves­sel es­ti­mated to be nearly 7,000 years old de­picts a priest-shaman (wu xi 巫覡) in the es­sen­tial pos­ture of med­i­ta­tive prac­tice and gym­nas­tic ex­er­cise of early qigong.

Qigong takes the con­cepts in tai chi to an even higher level. It is a holis­tic ap­proach to bring­ing body pos­ture, move­ment, breath­ing and med­i­ta­tion to­gether. It has the end goal of not just har­ness­ing qi (chi) but also help­ing its prac­ti­tion­ers cul­ti­vate and bal­ance that life en­ergy. With guid­ing roots for the prac­tice go­ing back to an­cient days be­fore orig­i­nal Taoist, Bud­dhist and Con­fu­cian philoso­phies, qigong of­fers those who study and prac­tice it rig­or­ously over an ex­tended pe­riod the means to be­come su­per­hu­man.

Qigong masters can store chi to use for im­mense strength, the abil­ity to with­stand ex­treme tem­per­a­tures and mirac­u­lous hands-on and re­mote heal­ing. In a very ad­vanced state of qigong called bigu, a per­son can go months or even years with­out eat­ing.

Chi­nese sol­diers prac­tice qigong to make them­selves more ef­fec­tive.

Al­though a full ex­plo­ration of these two prac­tices and re­lated ones is a much big­ger sub­ject than can be cov­ered here, at a min­i­mum the very pres­ence of these prac­tices points to a strong em­bed­ded cul­tural be­lief in the Chi­nese peo­ple’s abil­ity to bring to power en­er­gies be­yond what most of us could pos­si­bly imag­ine. Be­ing able to ac­tu­ally pro­duce the re­sults promised by these prac­tices takes that a ma­jor step fur­ther, in ways Western­ers and those un­fa­mil­iar with them can only imag­ine.

To­gether with the strong em­bed­ded cul­tures de­scribed ear­lier, the prac­tices of tai chi and qigong give the col­lec­tive force of the Chi­nese peo­ple a power that is far stronger and more united than per­haps many re­al­ize.

What Is Next for China and the Rest of the World

With the master plan of the “Belt and Road Ini­tia­tive” in place, China’s strong eco­nomic power (which it it­self drew on by ac­tively pulling in Amer­i­can con­tracts for ev­ery­thing from cloth­ing to tech­nol­ogy and then re­verse-en­gi­neer­ing those dis­ci­plines for its own use); China’s lead­er­ship on trade, in­vest­ment in­fras­truc­ture and for­eign aid; and China’s rapid ex­pan­sions in al­most ev­ery line of busi­ness in the world, China is in the strong­est po­si­tion of per­haps any coun­try to deal with many is­sues. So whether it is a geopo­lit­i­cal, en­vi­ron­men­tal, fi­nan­cial and/or trade cri­sis that has be­come the cri­sis of the mo­ment, one can be sure that China’s pres­ence, pref­er­ences and in­flu­ence will soon be felt greatly on these mat­ters more than most West­ern coun­tries.

For the rest of the world, what is per­haps most im­por­tant to re­al­ize is that China’s global plans to dom­i­nate world af­fairs, the econ­omy and even the con­trol of most of its crit­i­cal re­sources are al­ready well-seeded.

In Asia, China’s “Belt and Road Ini­tia­tive” drives much of how it is bring­ing North Africa, Europe, Asia, South Asia and South­east Asia to­gether. The AIIB, while fea­tur­ing ma­jor in­vestor coun­tries from through­out the re­gion and now grow­ing world­wide, con­sti­tutes yet an­other way in which the coun­try is seiz­ing the ini­tia­tive to act as the lo­cal “god­fa­ther” guid­ing how these mas­sive con­cen­tra­tions of wealth and the world pop­u­la­tions will evolve. The RCEP trade agree­ment builds on that with other ben­e­fits and con­trols, cre­at­ing yet an­other top­down-driven lead­er­ship op­por­tu­nity for China, with built-in walls to keep the West away.

China is also very con­sciously tar­get­ing the con­ti­nent of Africa as a source of strong fu­ture al­lies. This is still very much in the in­cu­ba­tion stage, but as the next years play out, those in­fras­truc­ture in­vest­ments, gifts of friend­ship and

con­ces­sions given in the form of the con­trol of im­por­tant nat­u­ral re­sources may turn out to be far more valu­able than al­most any other form of trans­ac­tional gains in the world.

It is im­por­tant to also note that China had the wis­dom to not only build a naval base on that con­ti­nent (in Dji­bouti, on the strate­gic Horn of Africa) but also to es­tab­lish one of its Silk Road banks in Dji­bouti.

It is even pos­si­ble, prob­a­bly later rather than sooner, that China’s cur­rency may soon be­gin to take over as the base­line cur­rency for many in­ter­na­tional trans­ac­tions. When that be­gins to hap­pen, the West­ern dom­i­nance in fi­nan­cial af­fairs will be very much in trou­ble.

In par­al­lel, the West­ern coun­tries’ economies con­tinue to weaken, as do al­liances such as the Euro­pean Union (EU), the UN and even the mil­i­tary de­fense al­liance NATO. With lead­er­ship in West­ern coun­tries be­ing ceded to in­ept and cor­rupt am­a­teurs such as Trump, power-hun­gry heads such as the newly em­pow­ered Pres­i­dent Re­cep Tayyip Er­do­gan of Turkey, lead­ers such as Rus­sia’s Putin (with their unique skills of lev­er­ag­ing the power of chaos) and the new elected of­fi­cials emerg­ing in Europe who may be even more ready than the United King­dom to dis­solve the EU, there is more room than ever for what ap­pears to be a sta­ble and well-thought-through sort of lead­er­ship such as what China cur­rently of­fers the world.

More than ever, it ap­pears this is be­com­ing not just “Asia’s time,” as a fa­mous re­gional bank­ing ad once de­scribed things a few years ago. It is now “China’s time.”

Map of China’s Master Plan for the ‘Belt and Road’ ini­tia­tive to drive trade be­tween China, Asia, South Asia, Europe, and Africa.

Photo by threin, CC

Photo by pfn, CC

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.