China and the World

Shaking the world

Across the globe, China’s influence is increasing – most especially in Africa

Gripping talks: South Africa’s leader Jacob Zuma meets Hu Jintao

Napoleon Bonaparte was a very quotable guy. He preferred lucky generals to smart ones, and he was convinced that an army marched on its stomach. But the French emperor would never have guessed that his most quoted bon mot would concern a country he never visited, let alone conquered. “Let China sleep; when she wakes she will shake the world,” he once observed. As The Economist points out “it has become the quote that launched a thousand articles”, including this one.

Not just articles, too. James Kynge’s award-winning book is titled China Shakes the World and Martin Jacques seems to have drawn on Napoleonic inspiration for his own 2009 effort When China Rules the World: The Rise of the Middle Kingdom and the End of the Western World.

Mark Leonard also penned a volume on a related theme. Hitherto an expert on European Union affairs, Leonard realised that the policy papers he was writing all had some type of China angle. As he put it in his book’s introduction: “Very few things that happen during my lifetime will be remembered after I am dead. Even 9/11 or the Iraq War – events which transfixed us, took innocent lives and decided elections – will gradually fade until they become mere footnotes in the history books. But China’s rise is different: it is the big story of our age and its after-effects could echo down generations to come.”

Since WiC published its first issue in February 2009, a recurrent theme has been China’s growing impact on the rest of the world. One facet of this: China’s economic rise has spawned a ‘going out’ strategy in which its firms have been encouraged to acquire assets abroad. Back in issue 55 we wrote about Geely’s acquisition of Volvo. That an iconic Swedish carmaker could be bought by a Chinese firm (that most Europeans had never heard of) spoke volumes about changing dynamics within the global auto industry, as China surpassed the US as the world’s biggest car market.

And as recently as last week we looked at another famous Western brand that had been purchased by the Chinese: UK cereal maker Weetabix, by Bright Food of Shanghai.

Continents, as well as companies, are also feeling the new weight of Chinese interest. Africa is a good example. In ‘Out of Chafrica’ (see issue 43), we described a $10 billion package of low-cost loans on offer from Beijing as a kind of Chinese Marshall Plan. China’s engagement with the region has won the praise of African leaders. Rwanda’s President told Handelsblatt: “The Chinese bring Africa what it needs: investment and money for governments and companies. China invests in infrastructure, and builds streets.” Abdoulaye Wade, president of Senegal until April, was also complimentary. While the West talks about investment, China builds roads, ports and mobile networks in record time, said Wade. “The Chinese are ready to take up the task, more rapidly, and at less cost.”

In WiC139 we examined the case of Angola, where the Chinese are even building an entirely new city: a million new homes at Kilambi Ki, built by CITIC Construction, with 10,000 Chinese workers. It’s a symbiotic relationship, mind you: by 2010 China was purchasing 45% of Angola’s oil output.­

Indeed, we have also made plain that China’s new Africa presence is not without controversy. There are many who see it as a new colonialist, intent on buying Africa’s abundant natural resources, and worsening the continent’s grim track record for corruption in the process.

Our review of the documentary film When China Met Africa looked at the impact of China’s considerable presence in Zambia. The film’s directors shadowed a series of Chinese businessmen in the country. New roads, a China-built copper smelter and an enthusiastic government minister were contrasted with darker scenes in which a Chinese farmer shouts at local labourers “Tell them to stay outside. Don’t let them come in the house.”

Another Zambian says of the farmer’s wife: “She thinks we are like cows”. So a force for raising Africa out of poverty, or a new colonial overlord?

That’s a question Deborah Brautigan explores in her excellent book The Dragon’s Gift: The Real Story of China in Africa (see issue 91), although she frames the debate somewhat differently, recognising that China is also a developing country.

Brautigan doesn’t portray all of China’s involvement in Africa as positive but she says it’s too simplistic to just see a rapacious drive for oil and metals.

Instead, she lists projects that demonstrate how China is offering aid and assistance in virtually every country in Africa – resource rich or not.

She also sees comparisons between China’s approach to Africa today and the way its own development was financed 30 years ago.

Likewise, many of the early loans a then-impoverished China got were also resource-based (with China offering Japan its oil). Her conclusion: “The deals they offer in Africa are based on similar deals Japan and the West offered China, decades ago, and which the post-Mao Chinese accepted in the belief that they could also win from an approach that was not about aid, but business.”

Nor is it just Africa where China is changing the terms of trade. In our Focus issue Forget the West, we looked at how China’s rise was also being felt in Latin America and the Middle East.

And then in our most recent Focus issue on Australia, we analysed how the ‘lucky country’ had bucked the international trend by avoiding a post-GFC slowdown (that’s global financial crisis, for the non-Australians). A lot of that was down to booming Chinese demand. And Australia’s economic fortunes are now increasingly tied to the world’s most populous country (both these Focus issues can be downloaded from our website).

We also described Canadian Prime Minister Stephen Harper’s recent trip to Beijing. Once a China critic, Harper is now keen to sell it Canadian uranium. Likewise he is backing a major pipeline to a shipment point on the Canadian west coast, for a new oil supply line to China. US authorities blocked a similar pipeline plan to ship Canadian oil to Texas. As the Wall Street Journal wrote this week: “For almost a century, Canada’s economy has been firmly tethered to its much larger southern neighbour. Now, Canadian officials and executives also are betting their future on China.”

Of course, all this activity abroad is changing China too. Three decades ago Deng Xiaoping defined Chinese foreign policy goals with the maxim: “Hide brightness, nourish obscurity; bide our time and build our capabilities.” In practical terms that meant years of low-key diplomacy, characterised by non-intervention in other state’s affairs.

The “going out” policy has made that commitment difficult to maintain. Most obviously it was overturned by events in Libya, where Beijing seemed unsure how to react to the ongoing civil war. But significantly, it chose not to veto UN action against Colonel Gaddafi, as it would have done in the past. Why? One realpolitik consideration would have been the prospects for its $18 billion investment in Libyan oil under a post-Gaddafi regime.

Similarly, China is now being pulled reluctantly into other disputes, including the deteriorating relationship between South Sudan and Sudan (over oil, again). Sure, it is not yet challenging America’s status as the world policeman, but it is definitely becoming more active in other country’s affairs.

And when it comes to China’s perception of its own sovereign territory, active can rapidly become aggressive. Another theme much mentioned in WiC (and likely to remain so) is China’s disputes with Japan, Vietnam and now the Philippines over contested territorial waters and islands in the South China Sea.


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