Changing relations!

For the UNCG MALS class, The Dragon Awakes, a question was asked: How should the US view China’s developing relations with her neighbors? Should the US modify its foreign policy toward these same nations in light of their changing relations with China?

If we do not include Japan and South Korea, with whom the US has strong relations, the areas of interest are as follows:

1. Association of Southeast Asian Nations (ASEAN)

Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia,

Myanmar (Burma), Philippines, Singapore, Thailand, Vietnam

2. Shanghai Cooperation Organization (SCO) countries

China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan (China and Russia are not included for this exercise.)

China’s expanding economic strength and need for increased energy and food sources is helping it improve relations with its neighbors. At the same time these improved relations are helping alleviate its security concerns. It is apparently succeeding to a considerable degree.

In general, it is difficult to see what the US can do differentially considering its “never ending” entanglement in Afghanistan and especially Iraq. The nation is weaker both militarily and economically and is looked at suspiciously by countries that have large Moslem populations including Brunei, Indonesia, Malaysia, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan. Even some of the other countries have significant Moslem populations. The US should bring its engagement in both Afghanistan and Iraq to a speedy end. Using its best efforts to bring permanent peace to the Israeli-Palestinian area would also help the US improve its relations with these countries. If at the same time the US improves its economics, so that it can improve trade with these countries, the accompanying foreign policy will improve.

India is an important player in the region, which is rapidly gaining strong economic power, may at some point rival, or even exceed, that of China; its population is expected to surpass that of China in the next twenty years or-so. It is important as a counterbalance to China. The US has reasonably good relations with India. However the weakened US economy and the decreased value of the dollar is lessening the economic attractiveness of the US; on the other hand, China’s is strengthening. India also has a Muslim population of about 14%. Once again the ability of the US to improve its relationship in the Asian area goes back to both its economic situation and Iraq.

The Taiwan Straits continues to cool

One of the pillars of the campaign, in Taiwan, which led to the recent landslide win for the Presidency of Ma Ying-jeou of the Nationalist Party (KMT) was the promise to improve relationship with mainland China. The outgoing president Chen Shui-bian of the Democratic Progressive Party (DPP) had been pushing vigorously for Taiwan to declare itself to an independent nation, separate from mainland China. China, which has always maintained that Taiwan is part of China, has threatened to mount military action if Taiwan were to declare independence. The election of Ma has decreased the threat of an eruption in the Taiwan Strait. The trip down the road to improved relations has started.

According to Reuters, on Saturday, April 12, 2008 vice-president elect Vincent Siew had a short meeting with Hu Jintao, China’s President. Siew was attending a meeting at the high-level Boao Forum for Asia in Boao, Hainan Provence. April 11-13, Siew was attending as Chairman of the Cross-Strait Common Market Foundation., a private NGO based in Taiwan.

It is not expected that there will be any formal announcements of policy change at this time. Even though Siew was not traveling as Taiwan’s vice-president, a position that will be acquired until the inauguration on May 20^th, analysts consider the meeting to be of historic importance considering the paucity of previous hi-level meetings.

Low-cost labor disappearing in southern China

After this past New Year break between 11 to 30% percent of the migrant workers did not return to many of the factories in Guangdong province, which had been one of the areas driving the Chinese economy. The annual movement of rural migrants into the factories that churn out low-cost products, requiring low skills, is clearly decreasing. It is also estimated that 70,000 factories have closed this past year and an equal number are expected to close in the next couple of years according to The Economist.

Several factors are responsible for the decrease in the number of factories closing in southern China, which contribute to the decrease in the influx of migrant labor. The costs of labor, energy, raw materials, environmental cleanup and credit have been increasing. Adding to the burden is a decrease in exports to the U.S. and other countries, in response to the economic downturn. On top of all these problems is an effort on the part of the government to force many of the grimy, low-paying factories away from southern China and into the interior, which has not benefited from the economic growth of the lat two decades. Cleaner factories which produce higher technology products and who pay higher wages, are not having problems attracting the needed labor. The government hopes that more will come in to take the place of those that have closed.

Factories are starting to open in the interior. One of the benefits is that the migrant workers are closer to home, making it unnecessary for them to be away for a whole year at a time. An additional benefit, if factories move into the interior rural areas, is that more of the benefits of China’s upward economy will also go there.

China’s road to superpower status takes strange twists.

In an earlier blog, “China’s Position on the World Stage”, criteria given for superpower status included economic power and the ability to influence internationally appears to be accruing for China!

An article in the International Herald Tribune, “China law could impede Microsoft deal for Yahoo” illustrates China’s growing economic power and ability to project that power internationally. At issue is Microsoft's hostile-takeover attempt of Yahoo. Doing so may cause it to run up against a new Chinese anti-monopoly law that takes affect in August. In 2005 Yahoo had obtained a 40% interest in Altaba.com China’s largest e-commerce business. The law gives Chinese regulators the power to examine and act upon foreign mergers that involve companies invested in Chinese businesses.

China’s burgeoning economic powers is starting to give it regulatory influence that may eventually match those of Washington and the European Union in Brussels.

Helping China’s young advance academically

As part of an assignment for the UNCG MALS Dragon Awakes course, we were to look at two different examples of China’s young. The first was an introduction to its culture in vibrant urban Shanghai, presented by FrontlineWorld reporter Nguyen Qui Duc with the help of Mian Mian who is “a poster child for spiritual pollution” according to government censors. The young came across as a frivolous group whose driving concern was fun and pleasure. The second example was with a young person named Alex who had more serious interests.

Alex is a serious young man whose thoughts went beyond the present. He was preparing himself for a good financial future to better himself, help his family and also his country. To that end he was majoring in Computer Science in college. Alex’s parents had lived through both China’s poorer times and the Cultural Revolution which likely meant that they were more concerned with obtaining the basics needed to exist. It was obvious that the parents wanted Alex to have better and helped him obtain it. No indication was given as to what was required of the parents to help Alex with his academic career. However, other examples that we have seen indicated that the parents often had to help both by encouragement and financially. Therefore any external financial help that could be obtained would be welcome to China’s young.

What may be an emerging approach to help China’s young advance academically, thereby helping both the person and the country, are scholarships provided by outside groups. One such scholarship has been announced by Peoples Daily Online as the “PD Online Scholarship.” The degree program to promote journalism and communication will be offered online at Peking University, Tsinghua University, Renmin University of China and the Communication University of China. Perhaps the concept will spread and will help more young people like Alex pursue their ambitions.

China’s Position on the World Stage.

With China's current internal problems, should its world power status be reconsidered? Can China successfully overcome these difficulties to achieve such status on the world stage?

For many years the two world superpowers were the U.S. and the Soviet Union. More recently the Soviet Union had dissolved leaving and a number of newly independent states.” This left only the U.S. as the single superpower. In even more recent times China’s remarkable economic expansion on to the world stage has led to speculation as to whether it is heading to superpower status. On the other hand, China’s current internal problems add some pause to its readiness to reach that spire.

To judge China’s status, a definition of what is a superpower is needed. One by Lyman Miller¹, which is generally accepted, says a superpower “is a country that has the capacity to project dominating power and influence anywhere in the world, and sometimes, in more than one region of the globe at a time, and so may plausibly attain the status of global hegemon.”¹ Does China fulfill the requirements of the definition?

Miller’s article first examined what was the basis, in the past, which made certain countries superpowers. Included were economic, ability to influence internationally, projecting of military strength. China is becoming strong economically, but it is far from being a leader. The ability to influence internationally is primarily vested in its permanent seat on the UN Security Council. China’s increasing military strength is still tailored for regional operation with special emphasis on the Taiwan Strait. All-in-all Miller says that China’s emergence, though spectacular, only allows it to be considered as a strong regional power rather than as a superpower. Perhaps someday, but not today! Additionally, nowhere among the parameters was internal problems considered as a factor.

The March 15, 2008 issue of the Economist² contains a special report titled “A Ravenous Dragon,” consisting of 8 interesting articles. It discusses China’s hunger for commodities to stoke their energy and industrial growth. Included among the commodities are oil, coal and metal ores including, among others, iron, aluminum, copper, zinc. Pertinent to this blog is the indication that China is setting up operations in a number of countries, including some with nasty governments, to aid them in their commodity procurement. This will enable China to increasingly be able to project its power internationally. The commodities that are coming back to China will primarily feed its growing heavy industry. The growth of heavy industry is adding to the huge environmental problems that China and its people are currently suffering. At the same time the growth of industry is adding to the turbulent social problem, especially the growing economic disparity between the urban and rural areas.

Can China’s current internal problems derail its present course to a stronger power status? Anything that could upset the political system within China, especially if it has characteristics that were as disruptive as the Cultural Revolution and Tiananmen Square Massacre, could slow down progress towards world power status. To calm its current internal problems, China will have to take some serious steps that will require the expenditure of a significant portion of its big economic growth. Indications are that China is starting to take its problems seriously. The question is will it be sufficient? What should also be considered is that the defining properties of world power status do not include internal or domestic problems; they are only of concern if they distract the country from its track to world status. In any event with China’s mounting presence on the world stage, being fed by the very powerful economic engine, it seems unlikely to be stopped!

1. Lyman Miller, China an Emerging Superpower? Stanford Journal of International Relations, Winter 2005.
2. Economist, (Go to website to locate March 15, 2008 issue, which contains Special Report consisting of 8 articles).

Taiwan's quest for independence likely to wane after election

It appears that with the forthcoming March 22, 2008 presidential election that, no matter who wins, there will be a push for closer ties with mainland China. Thus Taiwan will shift in the opposite direction from which the outgoing president Chen Shui-bian has been moving. Chen had gone so far as to put a referendum on the ballot to determine if Taiwan should apply for membership in the United Nations under its own name rather than the Republic of China.

According to the International Herald-Tribune, the two candidates, Ma Ying-jeou and Frank Hsieh have campaigned on bringing Taiwan closer to China and away from separatism. They differ on the degree of closeness and to the timing. After the election it is expected that the Taiwanese government will move to defuse the tensions that have been raised by Chen.

Ma represents the Nationalist Party or Kuomintang, while Hsieh represents the Democratic Progressive Party (DPP) of outgoing President Chen. Ma is currently favored to win the election. Hsieh campaigned in the shadow of Chen, whose second term has been rocked by scandal. It is further expected that if Ma is elected rapport with China will likely move forward more rapidly.