Growing strength of China masks doubts about future

Growing strength of China masks doubts about future

As Chinese around the globe celebrate the Year of the Tiger, many fear that the newly confident world power will try to thwart the west at every turn. But the leadership remains anxious about the true strength of its economy and society...continued below or follow link to source.

Source-Observer-http://www.guardian.co.uk/world/2010/feb/14/china-strength-doubts-future
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China last night heralded the lunar new year with the usual deafening, dazzling pyrotechnics. But outside the country, some fear the year of the tiger will see another kind of fireworks, as a newly confident world power asserts itself globally.

"China is getting stronger and stronger. You can see it from the happy faces coming to buy firecrackers," declared stallholder Han Jing, as she handed out rockets and other wares from her busy booth in north Beijing. In the economic crisis, it was not affected as badly as other countries. Our Chinese people have confidence that it will overtake every other country."

Grabbing a bumper packet of explosives, her customer Zhou Liyuan agreed. "At least the British drug smuggler [Akmal Shaikh] was executed. In the past, there would have been more negotiations. There are a lot of conflicts between China and the US now, and we have a stronger point of view this time."

Recent weeks have seen disputes with the west over everything from trade to climate change. In Europe and the US, business ­people and officials grumble privately of the increasing assertiveness – arrogance, say many – of this growing power.

"I think 2009 has been a turning point," said Professor Feng Zhongping, director of European relations at the China Institutes of Contemporary International Relations. "If you say China is more confident, that would be accurate. But I think there have been misunderstandings by the US and ­European governments and especially the media. I don't think China has become 'prickly'."

From the western perspective, China has been unwilling to shoulder the responsibilities that go alongside greater international power: failing to press Iran and North Korea on nuclear proliferation or to make a serious commitment to tackling climate change; punishing other countries with its artificially low currency.

It has brushed aside criticism on human rights and sought to export censorship, pressing overseas film festivals to drop documentaries on Tibet and Xinjiang.

But some of the recent tension has been overplayed. President Obama's predecessors also met the Dalai Lama and China objected in each case. The two are scheduled to meet on Thursday. Analysts also say Beijing has exerted more pressure on North Korea of late.

From Beijing's point of view, the west is making unrealistic demands – expecting it not only to understand other countries' priorities, but also to compromise its own interests.

"Some people's expectation of China was that, with economic development, foreign policy and political reform would become westernised," said Feng. A lot of people don't think a responsible great power just does what the US expects it to do."

Victor Gao, director of the China National Association of International Studies, argued that the US shopping list was increasingly long. "The arms sales to Taiwan and the visit of the Dalai Lama take place at a time they need help on Iran… What are the top three issues for America? If they put Tibet or Taiwan in there, I would be amazed," he said.

That helps to explain why China sees no point in yielding on certain issues.

"Beijing's new assertiveness is less the result of its growing economic clout than the realisation that [ultimately] western governments care far less about human rights than about trade and economics," said Nicholas Bequelin, Asia researcher at Human Rights Watch.

Elsewhere in the world, China's rise is met with as much enthusiasm as fear. Neighbours may be alarmed by its growing might, but there is greater enthusiasm on other continents.

Professor Deborah Brautigam, whose recent book The Dragon's Gift examines the Chinese presence in Africa, said that, while some there see China as "the new colonialist", others have welcomed it. "African leaders and commentators expressing this view are not naive about Chinese interest in Africa. But they actually like to hear the Chinese talk about investment opportunities instead of aid [and] are intrigued by models such as the resource-backed infrastructure loans," she said.

Analysts predict further tension, rather than a spectacular confrontation, between China and the west. Gao argues that the stakes are too high for both sides. "The decision-makers in this town are cautious, prudent people; not because they are afraid of the other side, but because they know increasing friction is bad for China, bad for the US and bad for the world," he said.

Beijing may be increasingly confident, but it does not yet believe its smooth ascendancy is a given. Underneath the veneer of confidence lie persistent anxieties about the true strength of its economy and society, and how to handle issues such as soaring inequality and endemic corruption. Such domestic vulnerabilities enhance the appeal of promoting popular nationalism, yet also reinforce the potential dangers of international disputes.

"What many observers see [as greater assertiveness] is in fact the product of a larger debate and policy struggle in Beijing about where China should be in the next 10 years and how it should get there," argued Russell Leigh Moses, a Beijing-based political analyst. The only real agreement thus far is that China is not to be pushed around, and so you get over-reaction and elbowing and jersey-tugging from many officials here."

And at street level, while many ordinary Chinese people celebrate their country's rise with pride, others are deeply cynical about its prospects. "We're a nuclear power, but are we prepared to use military power against anyone?" complained another of Han's fireworks buyers, who declined to give his name.

"The statistics that China provides about its economy are all fake. A lot of graduates can't get jobs. When ­outsiders come to Beijing it takes seven or 10 years to get a hukou [household ­registration], yet getting a US green card might not take them that long. I'm not sure whether China's stronger as a country – but its citizens aren't."

If such pessimistic judgments prove well-founded, the Chinese political establishment may face as much pressure from within as without, as it attempts to consolidate superpower status in 2010.


Without human rights China's boom will turn to bust

China must let civil society flourish, which means more political freedom



As a new Chinese year dawns, Beijing is feeling empowered on many fronts. Its seat is assured at the top table of every global summit, whether on financial matters, security or climate change.

At one level, the global balance of economic power has shifted decisively eastward. Most of the west spent the money it earned, borrowed more and spent that too. It is broke, while China's pockets are bulging.

The Chinese economy expanded by around 8% in 2009. The country has unrivalled status as exporter-in-chief to the rich world's consumers. Its own vast population is eyed thirstily by the industrialised world as a potential market, but the Communist Party has control over the terms of access.

That changing relationship has been accompanied by more Chinese assertiveness, both in foreign policy and domestic affairs. Dissent is being stifled with more vigour and less heed to outside criticism.

But it would be a mistake to see in that trend only Chinese strength. States also become more coercive when they feel insecure.

China's phenomenal economic expansion has many characteristics of a bubble. Most enterprises run on state loans, awarded on political, not commercial criteria. Debts accumulated in this way amount to nearly three times China's GDP – trillions of dollars. The exact amount is impossible to know because truly independent auditing would be tantamount to political sedition.

But as China integrates more with the global economy it will struggle to sustain the pretence that its domestic economy is based on real transactions, when so much of it is paper fiction. There will have to be an adjustment. It could be just painful; it could be calamitous.

That need for economic reform is inseparable from the need for greater democracy. The transition to a more functional domestic economy requires clear legal standards of property and consumer rights. That amounts to the same kind of reforms that democracy activists demand. Long-term economic stability and human rights both rely on trusted, independent legal institutions.

China urgently needs to discern its good businesses from its rotten ones. It will struggle to do that unless it has consumer organisations, sound commercial banks, free trade unions, independent accountants.

It must, in other words, let civil society flourish. That means more political freedom. Beijing is clearly not interested in taking lessons on political morality from the west. It might be more open to arguments based on hard commerce.


The tensions that define China's relationship with the west



Tension 1 The Dalai Lama
Meeting of Tibet's spiritual leader with Obama is a passing irritant

What's the problem?
China's Foreign Ministry has urged Barack Obama to cancel his meeting with the Dalai Lama, in Washington on Thursday, warning it will damage Sino-US relations.
View from the west
Washington and Europe are anxious to highlight the cause of exiled Tibetans and concerns about human rights in the autonomous region, particularly since the unrest of 2008. Every US president for the past 20 years has met the exiled spiritual leader. Obama delayed their meeting because he wanted to visit China first. That led to accusations he was soft-pedalling.
View from Beijing
China accuses the Dalai Lama of heading separatist forces – he says he seeks only meaningful autonomy – and has taken a tough line on his meetings with heads of state, particularly since his high-profile 2007 visit to the US. In 2008 it cancelled an EU summit after learning that French president Nicolas Sarkozy was to meet him.
How serious could the row become?
It is unlikely to escalate, although the fact that the meeting coincides with other frictions has complicated matters. China was keen to avoid a rerun of 2007, when George W Bush presented the Dalai Lama with the Congressional Gold Medal; it can live, albeit unhappily, with a private meeting at the White House.

Tension 2 Sanctions on Iran
Alienating a vital provider of energy has no rewards

What's the problem?
The west is pushing for substantial United Nations sanctions against Iran to curb a nuclear programme which it believes is pursuing military as well as civilian goals.
View from the west
The US defence secretary, Robert Gates, said last week that he wanted to see sanctions imposed in "weeks, not months". Western leaders warn that Iran is not serious about reaching a deal.
View from Beijing
Iran, led by Mahmoud Ahmadinejad, is a key ally and energy supplier; China, a member of the UN security council, feels it has little to gain from alienating it. It argues that diplomatic avenues have not been exhausted, that Iran's pursuit of nuclear weapons is not proved, and that sanctions will be ineffective. The US has sought to persuade Beijing by trying to set up a deal to safeguard its energy supplies and warning of the potential for Israeli military action.
How serious could the row become?
China's Foreign Ministry warned that the row over America's recent arms sale to Taiwan would "inevitably" affect regional and international co-operation – a comment many read as a signal that China would not play ball on Iran. Beijing could feel isolated if Moscow continues to stand alongside western powers, but even if it agrees to sanctions they are likely to be too watered down to satisfy others.
Tension 3 Arms sales to Taiwan
Despite the mainland's ritual fury, Taipei did not get all its wish-list

What's the problem?
The US is to sell Taiwan $6.4bn (£4bn) of arms – including Patriot missiles, mine-hunter ships and Black Hawk helicopters – under a deal agreed by the Bush administration.
The view from the west
The deal is necessary to keep the security balance in the region. The US also has a legal duty to help Taiwan defend itself; Beijing has more than 1,000 missiles pointing across the Taiwan Strait and says it could take military action if the self-ruled island seeks formal independence. However, Washington has not included the F16 fighter jets or submarine technology Taipei seeks.
View from Beijing
Its response to the announcement has been unusually strong: as well as suspending military exchanges, it threatened to place sanctions on US firms involved in the deal. Some analysts say leaders are seeking to defend their policy of thawing cross-strait relations; others that they want to prevent the sale of F16s and the like in future.
How serious could the row become?
It is probably not as bad as it looks. Despite suspending military exchanges, China appears to have approved a visit by the supercarrier USS Nimitz – one of the largest warships in the world – to Hong Kong this week. Experts suspect sanctions may be used to send a signal, but will probably not have a significant impact on US firms.
Tension 4 Currency
A slow march towards new trade balance

What's the problem?
The strength of the renminbi has been a long-running battle. Economists say it is undervalued by as much as 40% – encouraging cheap Chinese exports to flood other countries (thereby keeping down inflation, point out the Chinese) while discouraging imports.
View from the west
A substantial rise in the currency's value is necessary. Earlier this month Obama vowed to take a tougher stand on trade; given the state of the US economy, there is growing domestic clamour for action.
View from Beijing
China says it will not submit to pressure and accuses the US and Europe of protectionism. The recovery of exports (which plummeted last year) has persuaded many Chinese economists that appreciation is needed to head off nascent inflation and encourage a much-needed rebalancing of the economy, but Beijing will not want to look as if it has been pushed into a revaluation.
How serious could the row become?
There are fears this issue, alongside other trade frictions, could lead to tit-for-tat action, particularly if Obama formally labels China a currency manipulator. But China's deputy commerce minister last week dismissed prospects of a trade war; given their economic interdependence, all are likely to tread carefully. Many experts predict a slow, unheralded appreciation this year, but to a level far below US expectations.

Tension 5 Human rights
'There are no dissidents, only criminals'

What's the problem?
Human rights groups and foreign diplomats fear there is a growing attack on China's already fragile civil society, citing increased pressure on lawyers, internet censorship and a more punitive attitude to activists and dissidents, including writer Liu Xiaobo, sentenced to 11 years for subversion.
View from the west
China is not abiding by its own constitution, never mind international law, and must clean up its act if it wishes to be respected as a global power.
View from Beijing
China argues that other countries should not interfere in its domestic affairs. Asked about Liu's case last week, a Foreign Ministry spokesman told reporters: "China has no 'dissidents'. We only act in accordance with the law. There is only the difference between criminals and those who are not criminals." Some say western professions of concern are hypocritical and just another stick to beat China, given the record of the US and other countries on issues such as Guantánamo Bay.
How serious could the row become?
Both Chinese analysts and human rights campaigners are sceptical about whether western governments will make it a priority, particularly given the other issues – such as Iran – that they face.

Tension 6 Google and censorship
Defiant stand in web battle

What's the problem?
Google said last month it was no longer willing to censor its Chinese service, citing a China-originated cyber-attack that targeted human rights activists' email accounts.
View from the west
The Chinese should at least investigate the Google attack, which many suspect was sponsored or tacitly condoned by the government. China needs to roll back increasing online censorship and increase freedom of information.
View from Beijing
Initially gave a muted response to Google's bombshell. But Hillary Clinton's intervention prompted an angry fightback. State media accused the US of "online warfare", saying that it stirred up unrest in Iran.
How serious could the row become?
Google has said that it would like to remain in China. While officials are extremely unlikely to allow an uncensored search service, the firm might be able to maintain an advertising wing, for instance. Some doubt that internet freedom is truly a priority for America.









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