Why China’s Exports to North Korea are Growing

China’s exports to North Korea grew nearly 20 percent in the first half of the year, according to the Korea International Trade Association on Wednesday, despite its promises to crack down and impose international sanctions.China’s exports to the

Source: Beijing’s exports to Pyongyang swell 18%-INSIDE Korea JoongAng Daily

 

This should come as a surprise to no-one.

Beijing’s endgame with North Korea is clear: drain Pyongyang and its leadership regime – the Kim family – of every last penny of hard currency or valuable goods possible. Then, and only then, bring down the boot, and on Beijing’s terms, not Washington’s.

On The Global Times

There is some debate as to what degree The Global Times, the relentlessly jingoistic English-language daily published in Beijing, is in sync with the government and the party. While some China-watchers suggest that the GT is a pure party mouthpiece, others believe that it Zhongnanhai’s leashed pit-bull, useful to scare the neighbors, but in no way representative of the leash-holders true nature.

Fine.

Let us stipulate the following:

  • The Chinese government is not monolithic, and thus does not hold a single unified viewpoint on anything;
  • Opinions expressed in the media are often trial balloons; and
  • State media have, in the past, often represented minority points-of-view in the party.

All the above said, it is also true that Xi is wont to visit key media outlets – including The Global Times – to underscore that it is the duty of all media “love the party, protect the party, and closely align with the party leadership in thought, politics and action.” It is apparent to anyone watching the media in China – and that’s a lot of what we have to do in my business – that whatever tolerance there might have been for a degree of editorial heterodoxy is evaporating fast, if it has not already turned to fog.

Thus the assertion that The Global Times is offering opinions at odds with the thinking in Zhongnanhai to be far less credible today than three years ago. Lacking evidence to the contrary, we can only believe that the GT speaks with the voice and support of the highest party leaders.

Is China’s Navy hiding its real secret weapon?

The Chinese navy has in recent times focused much attention upon a decidedly more mundane and nonphotogenic arena of naval warfare: sea mines. This focus has, in combination with other asymmetric forms of naval warfare, had a significant impact on the balance of power in East Asia. In tandem with submarine capabilities, it now seems that China is engaged in a significant effort to upgrade its mine warfare prowess.

Source: Chinese Mine Warfare: A PLA Navy ‘Assassin’s Mace’ Capability | Andrew S. Erickson

The prolific and insightful Andrew Erickson suggested in 2009 that by focusing on aircraft carriers and anti-ship missiles, we may be missing the hidden secret of China’s maritime strategy: huge investments in mine warfare.

Is the Liaoning nothing more than a showy distraction, meant to invigorate nationalists at home and deceive observers abroad? This study makes an implicit argument that the received wisdom on China’s strategy is probably a false trail.

If nothing else, Erickson’s study should serve as a reminder that China will use a full spectrum of weapons in its efforts to control the seas, and that we have to be imaginative about what they will do, rather than allow ourselves to be sucked into a seductive narrative about carrier-killing missiles.

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Philippines sends six Coast Guard vessels to South China Sea

Move to guard Filipino fishermen in Scarborough Shoal

Source: Philippines sends six Coast Guard vessels to South China Sea | GulfNews.com

So the Philippine Coast Guard is going to protect Filipino fishing vessels.

There are yachts and fishing boats in any given marina in the US that are more heavily armed than your average Philippine Coast Guard ship. It’s a fairly good bet that the PLA(N) is unfrightened, which suggests that these ships are aught more than a tripwire, a means to provoke an incident.

There will be much to watch in the coming weeks.

New Imperial China and the US-Japan Alliance

The rise of China poses many questions, foremost of which is will a powerful China be a responsible member of the international community, complying with established rules and norms of the current global system? Or will it defy global standards, and strive instead to project its own rules and norms, thereby challenging the world order established by the United States?

Source: New Imperial China: A Challenge for the US-Japan Alliance | East-West Center | www.eastwestcenter.org

Short but good, this sharp piece offers some interesting – and still relevant – perspective on the escalating tensions in Northeast Asia.

A Peaceful Racist Rise: China, Africans, Race, and International Relations

Last summer there were a spate of articles documenting the sometimes latent and often blatant antipathy that many Chinese feel toward people of African descent. In Foreign Policy, Fulbright Scholar Viola Rothschild described her findings while conducting research on African entrepreneurs in China. Ayo Awokoya offered this cogent exposition of anti-African racism on line in China. Promotional posters for Star Wars: The Force Awakens were modified in China to minimize or eliminate non-white actors. And shrill government mouthpiece Global Times published a cartoon showing President Obama in a way that would, in the United States, be beyond the ken for even those publications in most vigorous opposition to the President.

My point is not to suggest that China is alone in its attitudes – indeed, the candidacy of Donald Trump in the current U.S. Presidential campaign has demonstrated that America is far from ridding itself of ethnic hatreds. Rather, it is to highlight several important points around the dialogue of China and its role in the world.

  • First, that China’s status as a nation of “color” (i.e., predominantly non-white in ethnic makeup and dominated by non-whites) does not excuse it or individual Chinese for racist behavior,
  • Second, that words or policies that favor or disfavor one race or another are no less racist in China than they would be elsewhere;
  • Finally, that neither the Chinese nor the peoples around the world with whom they have increasing contact have yet to reckon with that racism, its policy implications, and its potential impact on the world as a whole.

As China emerges as an international power, it faces the danger that latent racism in its relations with other countries will undermine its efforts to win friends beyond its borders. Veteran journalist Howard French, author of China’s Second Continent: How a Million Migrants are Building a New Empire in Africa, notes that Chinese operating in Africa are racist to the point that they are unconscious of the aspects of their behavior and speech that cause offense.

Provoking local resentment, though, is only the beginning of the dangers implicit in Chinese racism. Racism can fester all too easily into the kind of cultural chauvinism that propelled the worst elements of Japan’s foreign policy between 1868 and 1945. For the sake of both the nation and the world, China cannot be allowed to fall into that trap. The example of Japan – and those of the great European empires – offers a surfeit of reasons to fear a world power convinced of its own ethnic superiority.

One friend suggested to me that authoritarian regimes are naturally less racist. Even if we leave aside the extreme systemic racism of the USSR and the Third Reich, one would be hard pressed to prove that authoritarian regimes are better at eliminating de facto racism (or what I call “social racism”) than their pluralist counterparts. As the articles linked above attest, there is certainly social racism in China. And as for systemic racism in China, one need explore no further than its immigration policy, which makes attaining citizenship in China fairly straightforward for an ethnic Chinese applicant, but practically impossible for a caucasian, an African, or a Latino.

If we are going to call out our own governments and institutions for their racist behavior, we cannot afford to give other governments a pass. This is not imposing our standards or culture on another: it is, rather, compelling China to eschew a behavior that is inimical to its own interests.

And it would do us well to contemplate the implications for the world if a fundamentally racist nation were to win its bid for global leadership. Would such attitudes mellow? Could they? Or would they instead sow a value system where “diversity” became an obscenity?

A thought for the National Day holiday. Enjoy, and see you after the break.

Innovation and Standardization in China

The study examines defining characteristics of the evolving Chinese innovation and standards system and explores possible impacts for China as well as the global economy. China considers standardization to be an essential tool for improving its innovative capacity, yet very little is known about this critical building block of China’s innovation system.

Source: Indigenous Innovation and Globalization: The Challenge for China’s Standardization Strategy | East-West Center | www.eastwestcenter.org

The Infrastructure Thing

More than half of Chinese infrastructure investments have “destroyed, not generated” economic value as the costs have been larger than the benefits, according to researchers at Oxford university, a finding that will fuel debate over the viability of China’s infrastructure-heavy growth model.

Source: China infrastructure investment model under fire – FT.com

A fascinating article, and a reasonable proposition. Except for three things.

First, China remains short of infrastructure in key areas. A few examples: freight rail remains in desperate need of an upgrade; highways are groaning under the load of China’s car-crazy masses; and the power grid needs a switch to sustainable energy sources before coal chokes the country. As such, spending on new infrastructure per se is not necessarily misdirected.

Second, much of the infrastructure that has been built over the last thirty years is either worn out or was poorly built in the first place. The Chinese slang term “tofu construction” refers to just this phenomenon, and news reports offer discouragingly regular examples of underbuilt architecture.

Finally – and perhaps most important – most infrastructure (at least, the bits not made out of “tofu,”) is designed to last for a long time, often dozens of years. Any ROI calculation taken soon after completion is likely premature. By design, infrastructure should precede development, and is often the impetus of wider economic activity. Thus the effect of any given project on the wider economy is often impossible to gauge until long after construction.

Waste and graft permeate infrastructure development in China, and the government would do well to avoid dependence on infrastructure spending for growth. That said, more well-managed and thoughtful investment in infrastructure is needed, and will be for a long time.

And one last thought: better for reasons both economic and political that the government’s Keynesian spending goes into infrastructure that is ahead of its time than into military hardware and facilities.

 

Only China Can Contain China

Only China Can Contain China”
Joseph Nye

The Huffington Post
11 May 2015

Ariana Huffington’s eponymous clickbait factory is so often a cloaca of journalistic offal that it is almost painful to cite it, but this piece by Joseph Nye is an important exception, if for no other reason than its source.

Nye is a calming voice of reason, suggesting that despite China’s frequent and heavily-covered displays of bad-actor behavior, the interests that bind China, Europe, and the U.S. run deep and are often overlooked. His point is well-taken, and generally that approach offers a foundation for diplomacy for both President Obama and his successor.

But Nye the strategic optimist slips into Pollyanna territory when he notes:

Some analysts see China as a revisionist state eager to overthrow the established international order as its strength increases. But China is not a full-fledged revisionist state like Nazi Germany or the Soviet Union in the last century. While it has joined in the creation of a BRICS development bank, and promotes regional organizations that suit its needs, China has benefited greatly from, and is not eager to destroy, existing international institutions such as the UN, the International Monetary Fund, and the World Trade Organization — as well as many others. American allies help shape the environment that encourages responsible behavior, and China cares about its reputation.

China does care about its reputation, but Nye appears to summarily dismiss the possibility that China sees its reputation best served not as a conformist participant in a “Western” new order, but as the power that exploited that order, demonstrated its fundamental weaknesses, and then replaced it with an ostensibly superior international system rooted in Beijing’s own ethos.

China, in short, may not appear today to be a “full-fledged” revisionist state like the Third Reich, the USSR, or interbellum Japan. But even Nye must acknowledge that Germany and Japan both appeared to operate as troublesome participants of the post-Versailles system until at least the Marco Polo Bridge incident in 1937 (for Japan) and the Sudetenland crisis in 1938 (for Germany). Revisionist powers do not always start the game (as did the USSR) in open opposition. Some operate within it until they must reveal their true intentions.

Nye, for all of his wisdom, is no more privy to the thinking of Beijing’s highest councils than we.  At the same time, a wise and cautious observer will find in the pattern of Beijing’s actions over time evinces a design to displace – if not actually replace – the global international order with one of its own making. At the very least, we must prepare for a future when China finds its participation in the current liberal global system more a hindrance than a help, dividing the world into competing systems if not upending the existing order altogether.

The PLAN figures out expeditionary logistics

Sustained Support: the PLAN Evolves its Expeditionary Logistics Strategy | Andrew S. Erickson

The old saw about military affairs still applies: “amateurs study tactics, armchair generals study strategy, and true professionals study logistics.”

The prolific and erudite Andrew Erickson now delves into the most important question surrounding China’s growing naval expeditionary operations: how it is handling logistics. For a military lacking a significant history of operations with globe-spanning supply lines, the speed with which China can learn this craft will do much to determine both the sustainability and effectiveness of deployments abroad.

It’s not easy to strike that balance and do so cost-effectively: the recent prosecution of USN Captain Donald Dusek underscores the dangers of running an overseas logistics procurement operation, and shipping supplies from home will be expensive and tricky. Projecting power abroad will, for China’s armed forces, prove itself to be a cluster of unanticipated challenges.

Chinese SOEs and Diplomatic Immunity

There has been a lot of discussion in the news and online today about whether a Chinese state-owned enterprise can claim sovereign immunity from prosecution in the United States because they should be considered “an organ of the state.”

This is a legal question, and it is not cut and dried. Andrew Dickinson, Rae Lindsay, and Audley Sheppard of Clifford Chance in London did a superb write-up on the issue for the UN Special Representative on business and human rights, “State Immunity and State-Owned Enterprises.

The conclusion they reach will not salve the anger of anyone outraged by what appears to be a Chinese attempt to claim extraterritoriality for their largest companies. The issue is less a matter of statute than it is one of precedent, and the fact is, the matter could go either way.

For that reason, any Chinese state-owned enterprise operating in the US and facing civil or criminal prosecution in US courts would be foolish not to try to get an immunity ruling. At the same time, common sense would suggest to any businessman that caution is warranted in dealing with a Chinese SOE: the courts may not offer you the protections that you might expect.

In the long run, this will undoubtedly hurt Chinese SOEs: if they operate above the law while their US partners are subject to it, the legal imbalance in any contractual arrangement makes it foolhardy to contract with an SOE, to buy their products, or to engage their services. Careful businesspeople may wish to steer clear of Chinese state-owned enterprises for this reason alone.

Red Alert: The Growing Threat to U.S. Aircraft Carriers 

As China deploys surface-to-air missile (SAM) launchers to the Woody Islands in the South China Sea, CNAS Defense Strategies and Assessments Program Associate Fellow Kelley Sayler has written a new report, “Red Alert: The Growing Threat to U.S. Aircraft Carriers.” The report examines the short-, medium-, and long-range threats to the carrier – including SAMs and other anti-access/area denial capabilities, in which China is investing heavily – and concludes that U.S. carriers will not be able to act with impunity in the event of future conflict.

Source: Red Alert: The Growing Threat to U.S. Aircraft Carriers | Center for a New American Security

PLA Expeditionary Capabilities and Implications for United States Asia Policy 

Alongside China’s development of many capabilities necessary to conduct missions far from its borders, China’s actions to shape the international security environment are accelerating. This poses both opportunities and challenges for U.S. policymakers.

PLA Expeditionary Capabilities and Implications for United States Asia Policy | RAND

This is the text of the testimony Kristen Gunness made to the US-China Economic and Security Review Commission in January of this year. Reading between the lines, it is clear that China is determined to wield a big stick far from its home shores.

The Resilience of Cold War Strategic Alliances

William Tow at the Australian National University summarizes the results of an ANU conference covering the question of why Cold War strategic alliances remain in force in Asia. The obvious answer is “China.” But Tow notes that there is more to it than that, and that the bigger question facing these alliances is how much US involvement in those tie-ups is a substantive factor, and how much of it is so much rhetoric.
Tow’s paper is another sign that observers around the Pacific are unsettled about the degree to which the Obama Administration’s “Asia Pivot” is real vs. so much aspirational hot air.

Kroeber on Soros’ hard landing

In effect, the world has already experienced a China hard landing. This helps explain why markets react in such terror at every hint the renminbi might fall in value: a weaker renminbi reduces the dollar value of the goods China can buy on international markets, at a time when demand from its traditional industrial and construction sectors is already declining.

Source: Is George Soros Right that China’s Headed for a Hard Landing? | ChinaFile

Arthur Kroeber’s eloquent take on George Soros’ prediction: China is not likely to land hard this year. But the sum total of policy changes underway are going to make it a lot rougher for the rest of the world as China’s role as global growth engine diminishes. 

 

Revisiting the Umbrellas

“Hong Kong Revisited”
Jeffrey Wasserstrom
The LARB Blog
November 18, 2015

U.C. Irvine professor and prolific writer Jeffrey Wasserstrom offers a minimalist retrospective on the Umbrella movement a year after the events began, and on the lecture he gave in Hong Kong on the topic last fall.

And while there are many reasons to be deeply worried about Hong Kong’s future, it is important to remember that, at least for now, a public lecture focusing on protest and featuring a large group of citizens thinking together about their city, their politics, and their future, is still possible in that very special city.

Wasserstrom does not come right out and foretell the end of democracy in Hong Kong, but the tone carries that ominous, almost fatalistic, overtone. It is impossible to say whether the umbrella protests of 2014 will have a meaningful effect on how Hong Kong is governed. The real question is whether we have witnessed the last such protest in the city’s modern history.

We who live outside of Hong Kong shall have no say in the matter. The future of politics in Hong Kong lies in the hands of the people of that city and the men and women who rule China.

The CSIS on 2016

The end of the year always produces some superb retrospectives and forecasts. I’ve spent a few minutes every day of the last week going through The Economist’s 2016 forecast, and have found it excellent, although suffering from the limitations imposed by a generalist audience.
Those looking for a deeper dive into some of the world’s hot spots would be well-served to pick up the Center for Strategic and International Studies’ (CSIS) 2016 Global Forecast, available for a free download at the CSIS website. Of particular interest to China-watchers is part 5, which includes articles from Christopher Johnson (“rReform Cold, Politics Hot,”) Bonnie Glaser and Matthew Funaiole (“Geopolitical Consequences of China’s Economic Slowdown,”) and the brilliant Scott Kennedy (“Economic Consequences of China’s Economic Slowdown.”)
Add this to your January and Chinese New Year reading list.

Review Essay: An Unbetter China

Chinese armies defeating the Dzungar prior to the genocide.

There is a growing chorus of voices, mostly Sinophilic or Russo-philic, who attempt to bestow upon China a mantle of moral superiority in its dealings with the wider world for the sole reason that it has not waged any form of expeditionary warfare in its recent history.

This forum and this writer have criticized many of America’s forays into overseas military engagements over the past 50 years. That said, there is no moral standard of which this writer is aware that bestows moral ascendancy upon a country that systematically slaughters its own citizens over another country that engages in misguided adventures abroad.

It is possible to deplore most or even all major exercises of American military power abroad since the cessation of hostilities in Korea in 1953, to see them as misguided and their outcomes to be awful, and yet to acknowledge that with a few exceptions the intentions were neither evil, nefarious, nor malicious. As an historian, you judge the decisions of the past in the context of the times, on that basis this writer would argue that that on the balance the US mostly acted in good faith, with notable and egregious exceptions in Chile, Iraq and Afghanistan.

China’s history leaves the nation much for which it must answer, including the “red on its ledger” from the nation’s imperial period that has not been entirely expunged by decades of foreign incursion, Republican rule, civil war, and Communist rule. Indeed, in the period following the revolution, the Chinese Communist Party has continued some of the tendencies that characterized the worst behaviors of its emperors.

Explore, if you will, how a middling agrarian kingdom actually managed to expand to dominate the continent. I’ll give you a hint: they weren’t invited by their subject peoples, Han or otherwise. Dig, if you dare, into the the gritty details of China’s imperial tributary system, which was outwardly peaceful but often ugly and violent, involving the stationing of military forces beyond China’s borders. Ask the Koreans, Mongolians, and Russians how their histories see China as a “ good neighbor.”

Consider the forcible takeover of the Tibetan region in the 1950s, China’s war with India, and its attack on Vietnam in 1977. And finally, look at the background of the 20+ territorial disputes in which China is currently engaged, including China’s extraordinary claim to the overwhelming majority of the South China Sea, and it’s effort to buy vast swaths of land in Africa and elsewhere. China has been, and is once again, an Imperial Power with 21st Century Characteristics.

Both China and the US have done great things, and both have done atrocious things. But we do ourselves and those countries a disservice by exaggerating the good or whitewashing the bad of either. And if China appears to be under more of a microscope at the moment, there is good cause. For if we accept the premise proffered by scholars both within and outside of China that America is entering a period of relative decline in its international power and China is in a period of relative ascendancy, we must use extreme care in bestowing moral superiority over a nation whose record is distinctly mixed. Doing so only grants it license to engage in much more of the same.

Year-End Miscellany: Is Guo Meimei Real?

In thinking about the case of the notorious Guo Meimei, one cannot help but wonder about her provenance. I don’t literally mean where she came from, of course. Rather, I mean how the sequential scandals that have surrounded her seemed almost perfectly timed to incite the public outrage necessary to start cleaning up official corruption, and then the mess that is Macau.

The rapid prominence she received in the media, her un-preternatural naïveté, and the suspect coincidence of having her involved in two major criminal enterprises in a row seem all too good to be true. Given the effects of her behavior, one cannot be blamed for thinking that if Guo Meimei had never existed, the Party would have had to invent her.

Which then leads to the question: did they?

Okay, setting my tinfoil hat aside for the day.

Japan Debates the Issue of Comfort Women

How to Cleanse Asahi’s Widespread ‘Misreports’ on Comfort Women
Masaaki Sugiura 
The Global Forum of Japan
1 December 2014, Vol. 7, No. 6

Venerable Japanese political commentator Masaaki Sugiura, offers a rebuttal to sensationalist reports in the Japanese media (specifically the Asahi Shimbun) about Japanese soldiers and “comfort women,” local girls and women from territories conquered in Japan who were essentially forced into prostitution serving Japanese soldiery before and during World War II.

Masaaki does not seem to be associated with the kinds of nationalist factions that make a habit of whitewashing Japanese behavior in the war. What he does, however, is call into question the dominant Korean and Chinese narratives about “comfort women,” and suggest that the nature and extent of the problem may well have been exaggerated in China and Korea for domestic political purposes.

An interesting issue, and an interesting read.

Li Keqiang takes on the Aparatchiks

“In some cases after the senior leaders study an issue for over a year it takes another year to get the implementation procedures settled. Isn’t this ridiculous?” Mr. Li was quoted as saying.

“Before we can simplify administrative procedures and delegate authority to lower levels of government, we really need a revolution in our own thinking,” he reportedly added.

via China’s Levels of Bureaucracy Have Gotten ‘Ridiculous,’ Premier Says – China Real Time Report – WSJ.

As skeptical as I am about the ability of a one man to alter a governance model that has been in place since well before Beijing became the Imperial capital, I hope he succeeds. But I am not optimistic.

The problems of China’s bureaucracy are not unlike those that governments face elsewhere: corruption, careerism, and the promotion of the mediocre. Those call for more than simple spankings and token firings. They demand a systemic overhaul.

When Li creates a system that recognizes, rewards, and promotes public servants who are clean, dedicated, and effective and shitcans everyone else, he will have fixed the problem. Anything short of that is so much political theater.